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'8  I  I  .  I  I .  | 


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SPEECH 

i 

OF 

MR.  RIVES, 


VI  R  G  I  N  I  A, 

IN  OPPOSITION  TO 

THE  SUB-TREASURY  BILL, 

AND  IN  SUPPORT  OF 

HIS  SUBSTITUTE. 


DELIVERED  IN 

THE  SENATE  OP  T  I1*H  U  .  S . 
FEBRUARY  6,  7,  1838. 


PRINTED  AT  THE  MADISONIAN  OFFICE. 


1838. 


SPEECH. 


Mr.  President. — It  would  have  been  very  gratifying  to  me  if  I  had  found  the 
measure  now  under  consideration  such  an  one  as  I  could  conscientiously  sup¬ 
port.  The  question  is  one  which  every  interest  of  the  nation  requires  should  be 
settled — promptly, but  wisely  settled.  It  is  time  that  the  country  were  relieved 
from  those  anxieties  and  apprehensions  in  regard  to  the  future,  which,  added  to 
the  embarrassments  of  the  present,  weigh  like  an  incubus  upon  the  national  enter¬ 
prise  and  palsy  all  its  faculties.  I  should  have  been  most  happy,  therefore,  if  I 
could  have  seen  in  the  measure  recommended  by  the  Committee  of  Finance,  any 
of  those  healing  and  salutary  tendencies  which  the  circumstances  of  the  times 
and  the  situation  of  the  country  so  imperiously  demand.  I  had  hoped,  indeed,  at 
one  time,  that  such  a  measure  would  have  been  presented  to  us.  The  President, 
in  his  message  to  Congress  at  the  commencement  of  the  present  session,  while 
renewing  the  expression  of  his  own  opinions  in  favor  of  the  financial  project  of 
the  late  called  session,  very  properly  invited  the  consideration  of  Congress 
to  the  manifestations  of  public  sentiment  which  had,  since  then,  taken  place ;  and 
recognizing  “the  national  will  as  the  supreme  law  of  the  Republic,”  plainly  inti¬ 
mated  that  a  measure  which  had  proved  unacceptable  to  the  people  ought  not  to 
be  aoain  pressed  on  their  adoption.  I  had  hoped,  that  the  Committee  of  Finance, 
concurring  in  this  republican  sentiment  of  the  Chief  Magistrate,  and  in  the  pre¬ 
sence  of  the  manifestations  which  the  recent  elections  in  the  North  and  the 
South,  the  East  and  the  West,  had  afforded  of  the  national  repugnance  to  the 
measure  of  the  late  session,  would,  in  the  resources  of  their  wisdom  and 
acknowledged  abilities,  have  presented  us  some  other,  on  which  we  might  have 
rallied  with  more  harmonious  opinions.  I  am  sorry  to  say  that,  in  the  exami¬ 
nation  of  the  bill  on  your  table,  1  have  found  nothing  to  justify  or  sustain  this 
hope.  It  is,  in  every  essential  respect,  a  reproduction  of  the  condemned  measure 
of  the  late  session,  with  some  superadded  features,  which  only  seem  to  aggravate 
its  deformity  and  increase  its  dangers.  It  commits,  as  that  did,  the  millions  of 
public  treasure  to  the  hazardous  and  demoralizing  possession  of  executive  agents 

_ it  levies  that  treasure  from  the  pockets  of  the  people,  after  a  short  period,  in 

gold  and  silver  only — it  then  disposes  these  collections  in  masses  at  a  few  im¬ 
portant  commercial  points,  to  serve  as  a  basis  of  operations,  which  must  inevi¬ 
tably  terminate  in  a  great  Government  Bank — and  to  take  charge  of  and  manage 
this  machinery,  it  institutes  a  new  corps  of  executive  officers,  whose  very  name, 
(Receivers-general,)  calls  up  by  an  indissoluble  association,  the  extravagance, 
the  peculation,  the  clumsy  magnificence  of  that  bloated  and  unwieldy  system 
of  French  finance,  which  is  the  acknowledged  prototype  of  this  new  scheme. 

I  propose,  Mr.  President,  in  as  brief  and  rapid  a  manner  as  possible,  to  pass 
in  review  the  principal  points  of  this  new  financial  project.  Its  fundamental  and 
vital  principle  is  to  collect  the  public  revenue  in  gold  and  silver  only,  out  of  a 
circulation  consisting  exclusively  now,  and  mainly  at  all  times,  of  bank  paper 
for  the  common  uses  of  the  people.  Of  this  invidious  discrimination  between  the 
money  of  the  government  and  the  money  of  the  people,  and  its  anti-republican 
and  injurious  tendencies,  I  had  an  opportunity  of  stating  my  views  very  fully  du- 
rino-  the  late  session  of  Congress.  It  was  the  subject  of  very  thorough  discussion 


on  both  sides,  at  that  time  ;  and  for  one  I  am  perfectly  content  to  abide  the 
verdict  of  public  opinion  on  the  arguments,  on  the  one  side  and  the  other,  then 
presented,  it  was  shown,  in  my  judgment,  most  conclusively  that  the  effect  of 
this  principle  would  be  permanently  to  create  two  currencies  in  the  country — - 
one  and  that  the  “  better ”  one  for  the  government,  another  and  inferior  one  for 
the  people — that  it  would  thus  separate  the  interests  of  the  governors  from  those 
of  the  governed,  destroying  that  bond  of  sympathy  and  common  feeling  between 
them  which  is  the  best,  if  not  the  only,  security  for  a  sound  administration  of 
public  affairs — that  it  would  indefinitely  protract  the  present  derangement  of  the 
currency  and  deliver  it  over  ffnally  to  a  state  of  hopeUss  and  irremediable  disor¬ 
der — and  that  its  operation  upon  the  institutions  of  the  Slates  would  be  of  the 
most  hostile  and  destructive  character.  I  should  not  now  recur  to  those  topics, 
having  heretofore  discussed  them  very  fully,  but  that  the  Senator  from  New  York, 
(Mr.  Wright,)  has  thought  proper  again  to  argue  them,  and  I  must  say,  with  all 
his  ingenuity,  has  failed,  in  my  estimation,  to  shake  a  single  position  maintained 
by  the  opponents  of  his  bill.  It  has  been  fashionable  to  denounce  these  objections 
as  mere  ad  captandum  arguments  ;  but,  sir,  have  they  been  answered  ?  Can  they 
be  answered,  otherwise  than  byreturning  epithets  for  arguments  ? 

That  the  measure  would  establish  a  distinction,  an  odious  distinction,  be¬ 
tween  the  currency  of  the  government  and  the  currency  of  the  people,  cannot 
be  denied,  for  such  is  the  positive  provision  of  the  bill.  It  expressly  requires  that, 
after  a  certain  time,  the  government  shall  receive,  in  discharge  of  the  public 
dues,  and  pay  to  its  officers  and  other  creditors,  nothing  but  gold  and  silver  or  its 
own  paper,  while  the  common  currency,  in  which  the  people  transact  their  deal¬ 
ings,  would  still  remain  bank  paper.  The  fact,  then,  is  undeniable.  But  it  is 
intimated  there  is  nothing  wrong  in  this  ;  and  we,  who  oppose  it  are  asked  if 
we  would  have  the  government  in  the  present  condition  of  things,  for  example,  to 
receive  its  revenue  in  the  various  spurious  substitutes  for  money,  which  now  form 
so  large  a  portion  of  the  actual  circulation  of  the  country.  The  answer,  sir,  costs 
me  no  embarrassment.  I  say,  no;  but  this  is  precisely  a  case  in  which  tlie-e#- 
ception  proxies  the  rule.  The  present  is  a  temporary  and  accidental  state  of 
things  ;  and  the  refusal  of  the  government,  under  existing  circumstances,  to  re¬ 
ceive  the  degraded  currency  of  the  times  in  payment  of  the  public  revenue,  so 
far  from  being  founded  on  any  permanent  distinction  between  the  currency  of 
the  government  and  the  currency  of  the  people,  is  intended  to  do  away  that  dis¬ 
tinction,  and  to  provide  a  sound  convertible  currency  for  the  common  use  of  both 
government  and  people — for  the  joint  resolution  of  1816,  which  is  still  the  law 
of  the  land,  expressly  declares  that  when  the  banks  shall  resume  specie  pay¬ 
ments  and  thus  provide  the  people  with  a  sound  convertible  currency,  that  cur¬ 
rency  shall  be  equally  receivable  by  the  government  in  discharge  of  its  dues. 
But  the  bill  of  the  Honorable  Senator  contemplates  no  such  thing.  It  rejects  the 
paper  of  the  banks  inexorably,  under  all  circumstances  whatever — even  though 
convertible  instantly  into  specie.  It  will  have,  for  the  government,  nothing  but 
gold  and  silver,  or  its  own  paper.  It  demands,  with  Shylock  severity,  its  “ pound 
of  flesh,”  and  that,  too,  without  the  condition  of  humanity  imposed  on  the  Venitian 
Jew  “not  to  spill  a  drop  of  Christian  blood”  in  the  exaction. 

The  Honorable  Senator  from  New  York  seems,  however,  to  have  persuaded 
himself  that  the  requisition  of  gold  and  silver  in  payment  of  the  public  dues,  would 
improve  the  general  currency  by  bringing  into  circulation  a  larger  portion  of  the 
precious  metals.  But,  sir,  how  can  this  be?  It  was  shown,  in  the  discussions 
of  the  late  session  of  Congress,  that  when  there  are  two  currencies  in  a  country, 
one  answering  all  the  purposes  of  the  other,  and  a  valuable  purpose  besides,  that 
which  answers  the  additional  purpose,  would  be  at  a  premium,  and  being  so,  would 
not  enter  into  general  circulation,  but  be  bought  and  sold  as  an  article  of  merchan¬ 
dise.  According  to  this  law  of  currency,  it  would  follow,  under  the  operation  of 


5 


the  proposed  system,  that  gold  and  silver  only,  being  applicable  to  revenue  pay¬ 
ments,  they  would,  in  general,  command  a  premium,  and  would  consequently  be 
withdrawn  from  general  circulation.  They  would  be  sold  by  the  broker  to  the 
public  debtor,  who  would  pay  them  to  the  Government — by  the  Government,  they 
would  be  paid  out  to  the  public  creditor,  and  the  public  creditor  would  go  and  sell 
them  again  to  the  broker.  This  would  be  the  narrow  and  charmed  circle  of 
their  movement.  They  could  never  enter  into  the  general  circulation,  under  such 
circumstances  ;  nor,  indeed,  under  any  circumstances,  (as  has  been  amply  shown 
on  another  occasion,)  without  a  previous  suppression  of  the  smaller  denomina¬ 
tions  of  bank  notes,  for  which  this  bill  contains  no  provision. 

The  Honorable  Senator  also  argues,  that  this  policy  would  tend  to  secure 
soundness  in  the  paper  portion  of  the  currency,  by  checking  over-issues  of  the 
banks.  But,  instead  of  contributing  to  the  soundess  of  the  paper  currency,  it 
would  necessarily  increase  its  insecurity.  The  great  source  of  insecurity  in 
the  banking  system  at  present,  as  is  well  known,  is  the  danger  of  a  suspension  of 
specie  payments  arising  from  a  foreign  drain  of  the  precious  metals.  But  this 
measure  would  superadd  to  the  foreign  an  internal  drain  of  specie,  to  be  locked 
up  in  the  vaults  of  the  Government  ;  and,  from  the  nature  of  things,  this  internal 
and  external  drain  would  occur  at  the  same  moment,  and  exert  together  their 
destructive  influence  upon  the  banks.  It  would  be  in  years  of  heavy  importations 
that,  the  balance  of  trade  turning  against  the  country,  the  foreign  drain  would  be 
most  sensibly  felt,  and  it  would  be  precisely,  under  such  circumstances,  that  the 
demand  for  specie  to  pay  the  duties,  on  these  importations,  being  greatly  aug¬ 
mented,  the  internal  drain  wrould  operate  also  with  most  severity.  How  then  can 
the  Honorable  Senator  imagine  that  the  security  of  the  paper  currency,  supplied 
by  the  banks,  is  to  be  increased  by  exposing  them  to  a  double  pressure,  from 
within  and  from  without,  at.  so  critical  a  moment. 

In  regard  to  the  hostile  operation  of  this  measure  on  the  State  currencies,  and 
the  credit,  institutions  of  the  states,  the  honorable  Senator  has  taken  up  the  sub¬ 
ject  in  far  too  narrow  a  point  of  view.  He  spoke  as  if  the  whole  matter  of 
complaint,  in  this  respect,  consisted  in  withholding  the  deposites  of  the  public 
money  from  the  banks.  But,  sir,  ihegist  of  the  question  does  not  lie  here.  This  is 
a  matter  in  which  the  convenience  and  the  safety  of  the  government  itself  are  con¬ 
cerned  far  more  than  any  interest  of  the  Banks  generally,  or  of  the  states  by  which 
they  are  created.  The  real  grievance  is  in  the  stern  exclusion  by  law  of  the 
sound  convertible  currencies  of  the  states  from  all  transactions  of  the  Federal 
Government,  (transactions  in  which  they  have  been  heretofore  invariably  admitted, 
from  the  origin  of  the  government  to  the  present  day.)  the  official  discredit  and 
protest ,  in  advance,  thus  stamped  upon  those  currencies  by  the  unfriendly  action 
of  this  government.,  giving  the  signal  for  general  distrust  and  want  of  confidence 
in  regard  to  them.  Sir,  it  will  be  no  difficult  matter  to  show  that,  under  the  blight 
of  this  legislative  denunciation,  and  in  the  progressive  working  of  the  system  now 
proposed,  the  state  currencies  will  be  finally  broken  down,  and  a  national  govern¬ 
ment  paper  currency,  resting  on  the  same  principles  as  our  old  continental  money, 
be  made  to  take  their  place.  But  the  Senator  from  New  York  tells  us  that  the 
state  currencies  will  enjoy  as  much  favor  under  the  new  policy,  as  they  did  under 
the  regime  of  the  U.  S.  Bank — that  that  institution  very  rarely  received  the  notes 
of  the  State  Banks  in  collection  of  the  public  revenue,  and  when  it  did  so,  it 
promptly  returned  them  for  conversion  into  specie.  I  certainly  had  not  expected, 
Mr.  President,  that  the  Bank  of  the  United  States  would  be  held  up,  from  that 
quarter,  as  a  model  for  imitation,  in  regard  to  its  policy  toward  the  state  institu¬ 
tions.  But  the  Senator  is  mistaken  in  what  he  says  of  the  course  of  that  institu¬ 
tion,  and  it  will  appear  that  even  its  policy  was  one  of  far  more  liberality  toward 
the  state  institutions  than  that  which  the  honorable  Senator  himself  now  proposes. 
It  is  officially  stated  in  the  triennial  report  of  the  President  of  that  institution  to 


6 


the  stockholders  in  Sept.,  1831,  that  the  Bank  of  the  U.  S.  was  in  the  practice  of 
“  receiving  freely  the  notes  of  the  State  Banks,  within  convenient  reach  of  the 
Bank  and  its  branches;”  and  this  free  reception  of  the  notes  of  the  State  Banks 
and  periodical  “  settlements  of  accounts ”  with  them,  were  the  boasted  means  on 
which  that  institution  relied  to  regulate  and  preserve  the  soundness  of  the 
general  currency  of  the  country.  It  is  farther  shown  by  the  answer  of  thatofficer 
to  certain  interrogatories  propounded  to  him  by  the  Committee  on  Finance,  of  this 
body,  in  March,  1830,  that  though  frequent  “  settlemeiits  of  accounts”  were  made 
by  the  Bank  of  the  U.  S.  with  the  State  Banks,  they  were  “rarely  forced  to  pay 
specie”  to  any  considerable  amount  for  their  notes,  but  payment  was  taken  in  their 
bills  of  exchange,  or  balances  permitted  to  lie  over,  ’till  melted  down  in  the  ordi¬ 
nary  course  of  their  business  and  mutual  transactions.  This  statement  is  sus¬ 
tained,  through  a  series  of  years,  by  the  annual  returns  of  the  Bank  to  Congress, 
exhibiting  generally  large  balances  due  to  it  from  the  State  Banks.  But,  sir,  even 
though  the  course  of  the  U.  S.  Bank  had  been  as  unfriendly  toward  the  state  insti¬ 
tutions,  as  the  gentleman  from  New  York  supposes,  the  law  of  the  land ,  the  legis¬ 
lation  of  Congress,  made  no  attack  on  them,  as  is  now  proposed.  On  the  contrary, 
their  credit  was  cherished  and  sustained  by  the  law  ;  for  the  joint  resolution  of 
1816  expressly  declared  that  their  notes,  when  convertible  on  demand  into  spe¬ 
cie,  should  be  receivable,  equally  with  specie,  in  payment  of  public  dues.  This 
is  the  important  consideration  ;  for  in  the  law ,  in  the  policy  and  language  of  the 
government ,  abides  mainly  that  principle  of  confidence ,  on  which  all  paper  curren¬ 
cy  rests,  and  which  is  now  proposed  to  be  rudely  withdrawn  from  the  currencies 
of  the  states,  however  unquestionable  their  soundness  and  value. 

But,  Mr.  President,  without,  dwelling  farther  on  these  considerations,  I  beg 
leave  to  ask  gentlemen  who  are  so  zealously  patronising  the  policy  of  this  mea¬ 
sure,  if  they  can  adduce  to  us,  from  ancient  or  modern  times,  from  civilised  or 
even  barbarous  communities,  a  solitary  example  of  a  government  demanding  and 
collecting  its  revenue  in  a  currency  different  from  the  common,  actual  currency  of 
the  country.  If  there  be  any  such,  it  has  escaped  my  researches.  In  countries 
where  the  public  revenue  may  have  been,  or  may  now  be,  collected  in  gold  and 
silver,  it  will  be  found  that  gold  and  silver  constitute  the  common,  actual  currency 
of  the  people.  Even  in  England  and  France,  where  the  circulation  consists,  in 
so  large  a  proportion  of  the  precious  metals,  the  revenue  payments  are,  by  no 
means,  confined  to  gold  and  silver ;  but  bank  notes  are  freely  received  in  both,  in 
discharge  of  the  government  dues.  It  is,  indeed,  a  fundamental  maxim  of  taxation, 
laid  down  by  all  writers  on  political  economy,*  and  respected  in  the  practice  of 
all  governments,  that  the  mode  of  payment  of  the  public  contributions  ought  to  be 
that  most  consistent  with  the  convenience  of  the  payers — the  great  body  of  the 
community.  Is  it  reserved  for  the  government  of  the  United  States,  in  its  theory 
the  most  popular  on  earth,  and  claiming  the  merit  of  the  closest  sympathy  with  the 
wants  and  interests  of  the  people,  to  set  the  first  example  of  a  departure  from  this 
just  and  benignant  rule  of  policy  ?  and  for  what  reason — for  what  purpose?  I 
think  I  have  shown  that  none  of  the  great  interests  of  the  country  are  to  be  pro¬ 
moted  by  it.  It  may,  it  is  true,  be  quite  agreeable  to  the  office-holders,  and  other 
recipients  of  the  bounty  of  the  government,  to  obtain  their  emoluments  in  a“  bet¬ 
ter”  currency,  than  the  common  currency  of  the  people  ;  but  surely  this  will  be 
held  no  legitimate  consideration  for  legislators  and  statesmen.  What  end,  then, 
is  to  be  answered  ?  What  object  to  be  promoted  by  the  introduction  of  this  anoma¬ 
ly  in  the  history  of  legislation  ?  Is  it  to  carry  out  some  theoretical  dogma — some 
mere  common  place  of  party?  Is  it,  in  short,  to  satisfy  the  notions  couched  and 
propagated  under  the  well-sounding  phrase  constitutional  currency. 

I  ask,  then,  what  is  meant  by  this  phrase  ?  Is  it  meant  that  no  other  currency 
is  constitutional  but  gold  and  silver  ?  If  so,  I  deny  the  proposition.  Bank  notes, 


♦Smith’s  Wealth  of  Nations — Book  Y.  chap.  II. 


7 


as  currency ,  are  as  constitutional  as  gold  and  silver.  The  constitution,  it  is  true, 
declares  that  “  no  state  shall  make  any  thing  but  gold  and  silver  coin  a  tender  in 
paymeni  of  debts.”  This  was  intended  to  establish  an  ultimate  standard  of  value 
for  the  adjustment  of  contracts,  where  the  parties  chose  to  insist  on  the  strictness 
of  legal  rights,  but  not  to  prevent  the  states  from  authorizing  convertible  represen¬ 
tatives  of.  that  value  to  be  used  as  currency ,  or  a  common  medium  oj  exchange  and 
circulation,  in  the  ordinary  business  of  life.  On  the  contrary,  those  representa¬ 
tives  in  the  shape  of  bank  notes,  were  known  and  used  as  currency ,  at  the  time  of 
the  adoption  of  the  constitution,  and  nothing  in  that  instrument  prohibits  them — 
the  states  have,  constantly  since,  been  in  the  habit  of  creating  corporations,  au¬ 
thorized  to  issue  and  circulate  them — the  power,  thus  exercised  by  the  states,  has 
been  invariably  acquiesced  in  and  recognised  by  the  General  Government — and 
recently  it  has  been  determined  by  the  solemn  and  unanimous  judgment  of  the 
highest  judicial  tribunal  of  the  country,  (in  the  case  of  Briscoe  vs.  the  Common¬ 
wealth  Bank  of  Kentucky,)  that  the  states  rightfully  and  constitutionally  possess 
the  power.  I  say  it  was  unanimously  so  decided  by  the  Supreme  Court,  because, 
although  a  minority  of that  court  were  of  opinion  that,  where  the  state  owned  the 
entire  stock  of  the  bank,  the  exercise  of  the  power  would  be  an  infringement 
of  the  constitutional  prohibition  on  the  states  “to  emit  bills  of  credit,”  yet  all  the 
Judges  concurred,  that  the  authority  of  the  states  was  unquestionable  where  the 
stock  of  the  banks  was  owned  either  by  individuals  entirely,  or  by  them  in  com¬ 
mon  with  the  state  as  a  partial  stockholder.  State  Bank  notes,  then,  being  issued 
in  pursuance  of  an  unquestionable  constitutional  authority,  are  a  constitutional  cur¬ 
rency ,  as  well  as  gold  and  silver.  It  is  true,  a  creditor  cannot  be  compelled  to  ac¬ 
cept  payment  of  his  debt  in  bank  notes,  if  he  object  to  doing  so  ;  but  this  does  not 
affect  their  character  as  currency ,  as  a  common  medium  of  exchange  and  circulation , 
or  prevent  a  payment  in  bank  notes  from  being  a  final  and  complete  discharge  of 
the  debt,  if  accepted. 

But,  perhaps,  by  this  oft  repeated  phrase,  it  is  meant  to  be  implied  that  there  is 
some  special  constitutional  obligation  on  the  government  to  demand  its  dues  in 
gold  and  silver.  There  is  as  little  foundation,  however,  for  this  notion  as  for  that 
which  I  have  just  exposed.  The  government  is  like  every  other  creditor.  It 
has  the  power ,  as  every  individual  creditor  has,  (if  it  chooses  wantonly  to  exert 
it,  and  to  recur  to  the  rigor  of  strict  right,)  to  insist  on  the  payment  of  its  dues  in 
gold  and  silver;  but,  as  an  individual  creditor  also,  it  may  waive  its  strict  right, 
the  sternness  oft  he  summum  jus,  (which,  we  are  told,  is  most  frequently  summa 
injuria,)  and  receive  its  dues  in  the  same  medium  which  individuals  and  the  people, 
by  common  consent,  use  for  the  adjustment  of  their  transactions.  This  it  has  done, 
from  the  adoption  of  the  constitution  to  the  present  day,  and  never,  heretofore, 
with  any  question  of  the  constitutionality  of  the  procedure.  It  not  only  has  the 
constitutional  power  which  every  other  creditor  has,  to  waive  the  strictness  of  its 
right,  in  this  respect,  but  it  is  especially  incumbent  on  it,  as  the  common  agent  of 
the  people,  guided  by  that  fundamental  and  benignant  maxim  of  taxation,  to  which  I 
have  already  adverted,  to  waive  an  extreme  right,  which,  in  its  exercise,  would 
so  seriously  affect  the  convenience  of  its  constituents — the  great  body  of  the  people. 

We  must  not,  then,  be  led  away,  under  the  dominion  of  well-sounding  phrases, 
of  plausible  or  pompous  common  places,  to  disregard  the  real  interests  of  the 
country.  As  legislators  and  statesmen,  we  must  emancipate  our  minds  from  the 
delusive  authority  of  mere  dogmas,  and  look  to  the  consequences  of  our  actions, 
the  practical  effects  of  our  measures.  If  we  trace  this  requisition  of  specie  for  the 
public  dues  in  its  effects  on  the  actual  business  of  society,  we  shall  find  that  it  is 
calculated  to  convulse  the  whole  monetary  system  of  the  country,  and  to  keep 
it  in  a  state  of  ceaseless  and  distressing  commotion.  Under  the  operation  of  the 
Banking  system  as  it  exists  in  this  country,  specie  is  to  be  regarded  not  so  much 
a  part  of  the  currency,  as  the  basis  or  source  of  a  far  larger  portion.  For  every 


8 


dollar  of  hard  money  that  is  taken  from  the  banks,  four  or  five  times  its  amount 
is  withdrawn  in  another  form  from  the  actual  circulation  of  the  country.  Bear¬ 
ing  this  in  mind,  let  us  see  how  the  proposed  system  would  work.  In  years  of 
abundant,  importation,  the  circulation  of  the  seaports  being  insufficient  to  furnish  the 
requisite  sums  of  specie  to  pay  the  duties,  largo  amounts  would  be  drawn  from 
the  South  and  West  to  meet  the  demands  of  the  custom  house  in  the  North 
and  the  East.  The  sections,  thus  stript  of  their  specie,  would  be,  all  at  once,  sub¬ 
jected  to  the  greatest  of  all  calamities  in  a  pecuniary  point  of  view — that  of  a  de¬ 
ficient  circulation,  suddenly  contracted,  not  in  the  ratio,  merely,  of  the  specie 
removed,  but  of  four  or  five  times  its  amount ;  for  to  that  extent  would  the  banks  be 
compelled  to  call  in  their  circulation,  in  order  to  meet  the  drafts  upon  them  for  the 
precious  metals.  Under  this  desolating  process,  the  prices  of  property  would  be 
struck  down,  the  relation  of  debtor  and  creditor  violently  disturbed,  and  every  branch 
of  industry  paralysed  and  withered.  On  the  other  hand,  when  the  land  sales  be¬ 
came  active,  the  current  would  be  reversed,  large  masses  of  specie  would  be 
drawn  from  the  North  and  the  East  to  the  South  and  the  West,  attended  with 
the  same  distressing  effects  on  the  trade  and  industry  of  the  country,  and  only 
shifting  the  theatre  of  their  disastrous  operation.  What  could  result  from  this 
perpetual  dragging,  to  and  fro,  of  the  specie  of  the  country,  contrary  to  the  natural 
laws  of  trade,  and  in  obedience  ordy  to  arbitrary  governmental  regulations,  but  in¬ 
cessant  throes  and  convulsions  in  the  whole  system  of  its  business  and  currency  ? 

It  would  be  some  compensation,  in  a  national  point  of  view,  if  the  specie,  of 
which  different  portions  of  the  country  would,  in  their  turn,  be  stript,  under 
the  operation  of  this  new  system,  were  restored  to  active  and  beneficial  use  in 
those  sections  to  which  it  would  be  transferred.  But  would  this  be  the  case  1 
No,  sir.  The  whole  surplus,  beyond  the  current  disbursement  of  the  Govern¬ 
ment,  would  rest  in  barren  and  unproductive  idleness,  in  the  “  vaults  and  iron 
safes”  of  your  Sub-treasuries.  It  would  be  an  annihilation  of  so  much  of  the 
national  capital,  susceptible  of  multiplication,  through  conventional  substitutes, 
to  four  times  its  nominal  amount,  and  capable  of  fructifying  and  sustaining  the 
national  industry  to  a  corresponding  extent.  I  must  confess,  Mr.  President,  that 
this  monopoly  and  hoarding  of  the  precious  metals  by  the  Government,  does 
seem  to  me  unworthy  of  the  age  in  which  we  live.  We  may  find  examples  of 
it  among  the  nations  of  antiquity.  But  their  circumstances  were  very  different 
from  ours.  They  were  engaged  in  frequent  wars,  and  they  accumulated  their 
treasure,  in  advance,  as  a  provision  for  those  national  emergencies,  always  with 
them,  more  or  less  near  at  hand.  It  may  also  deserve  consideration  whether  the 
practice  which  prevailed  among  them  of  hoarding  the  public  treasure  was  not  the 
cause,  fully  as  much  as  the  effect,  of  the  frequency  of  their  wars  ;  for  the  relief 
to  industry  from  unlocking  those  vast  hoards  in  time  of  war,  may  well  be  con¬ 
ceived  to  have  rendered  the  occurrence  of  war  no  unwelcome  event  to  their 
crowded  populations.  If  we  descend  to  modern  times,  we  find  no  instance  of 
this  national  hoarding,  but  among  rude  and  uncivilised  communities — the  Bar¬ 
bary  powers  or  the  Tartar  tribes,  for  example.  The  Dey  of  Algiers  is  said 
to  have  been  the  master  of  a  large  hoard  of  accumulated  treasure,  when  he  was 
expelled  from  his  dominions  by  the  French.  So,  also,  was  Mazeppa,  the  cele¬ 
brated  Cossack  Chieftain,  the  untutored  ally  of  Charles  the  NIL  But  surely, 
we  are  not  going  to  the  banks  of  the  Dnieper,  or  the  shores  of  Africa,  for  les¬ 
sons  in  policy  and  legislation.  We  shall  not  thus,  I  humbly  trust,  dishonor  the 
spirit  of  the  age,  belie  the  genius  of  our  free  institutions,  and  mar  the  destinies 
of  our  great  and  glorious  country. 

But  there  are  other  aspects  of  this  measure  even  more  dangerous  and  alarming. 
In  the  remarks  I  had  the  honor  to  submit  to  the  Senate,  at  the  late  session, 
I  said  that  this  scheme  had  a  squinting,  “  an  awful  squinting”  towards  a  Trea¬ 
sury  Bank.  It  now  has  that  character  boldly  planted  on  its  front.  It  is,  to  all 


9 


intents  and  purposes,  a  great  Government  Bank ;  and  of  this  I  persuade  myself 
I  shall  be  able  to  satisfy  every  gentleman  who  will  do  me  the  honor  to  accompa¬ 
ny  me  in  the  analysis  I  propose  to  make  of  its  composition.  In  the  first  place, 
the  national  revenue,  collected  in  gold  and  silver,  is  to  be  disposed  in  masses 
at  certain  leading  points,  designated  by  their  importance  in  a  commercial,  finan¬ 
cial,  or  political  view.  The  bill  directs  that  there  shall  be  a  great  cental 
depot  of  it  in  the  new  treasury  building  here — another  depot  in  the  mint  at  Phi¬ 
ladelphia — a  third  in  the  branch  mint  at  New  Orleans,  and  four  other  similar 
depots  of  the  national  treasure  in  gold  and  silver,  at  New  York,  Boston,  Charles¬ 
ton,  and  St.  Louis.  Buildings  are  to  be  erected  (where  they  do  not  already  exist,) 
for  the  reception  and  security  of  these  funds,  fitted  up  with  vaults,  safes,  and  all 
the  usual  appendages  of  a  banking  establishment.  The  Treasurer  and  the  Secre¬ 
tary  ol  the  Treasury  are  to  preside,  particularly,  over  the  central  establishment 
here — the  Treasurer  of  the  mint  and  the  branch  mint  over  the  establishments  in 
Philadelphia  and  New  Orleans,  and  four  Receivers  General,  with  their  clerks  and 
assistants,  over  those  at  New  York,  Boston,  Charleston,  and  St.  Louis.  Thus 
you  have  the  funds  or  capital  to  operate  on,  placed  in  position  at  suitable  points, 
and  a  complete  organization  of  officers  to  manage  and  administer  those  funds. 
Nothing  but  the  plastic  hand  of  the  Secretary  of  the  Treasury  will  be  wanting  to 
mould  these  materials  into  a  bank,  and  to  give  motion  and  direction  to  the  ma¬ 
chine.  How  will  it  be  done  ?  The  modus  operandi  will  be  perfectly  natural 
and  simple. 

The  Government  funds,  compared  with  the  disbursements  to  be  made,  will  bo 
in  excess  in  some  places,  while  they  will  be  deficient  in  others.  They  must 
then  be  transferred  from  one  place  of  deposite  to  another.  This  will  hardly 
ever,  it  is  to  be  presumed,  be  done  by  an  actual  transportation  of  specie. 
It  will,  doubtless,  be  generally  effected  by  the  ordinary  commercial  means  of  drafts 
and  bills  of  exchange.  The  bill  most  sedulously  gives  to  the  Secretary  of  the 
Treasury  an  unlimited  discretionary  authority  to  make  and  order  these  transfers 
from  one  place  of  deposite  to  another,  and  from  one  individual  depository  to 
another.  At  a  place,  therefore,  where  the  government  funds  are  in  excess,  and  he  ' 
wishes  to  transfer  a  portion  of  them  to  some  other  place  where  they  are  defi¬ 
cient,  he  will  naturally  direct  a  draft,  or  bill  of  exchange  on  the  latter  place  to 
be  bought,  paying  for  it  out  of  the  specie  accumulated  in  excess  at  the  place 
of  the  negotiation.  On  the  other  hand,  when  he  wishes  to  draw  funds  from  a  dis¬ 
tant  place,  where  they  are  in  excess,  to  a  place  where  they  are  deficient,  a  bill 
on  the  former  place  will  be  sold,  and  the  money  received  for  it,  added  to  the  de¬ 
ficient  funds  at  the  place  of  the  negotiation.  The  officers  of  the  Govern¬ 
ment,  thus  operating  on  the  public  funds  under  this  system,  would  become 
habitual  dealers  in  exchange — a  regular  and  acknowledged  branch  of  the  business 
of  banking.  In  the  exercise  of  these  functions,  the  accommodation  of  indivi¬ 
duals  would  come  to  be  fully  as  much  consulted  as  the  wants  of  the  Government. 
The  Receiver  General  at  St.  Louis,  for  example,  having  an  excess  of  the  public 
moneys  in  his  hands,  and  instructed  to  transfer  that  excess  to  the  Sub-treasury 
at  New  York,  would  naturally  do  so  by  buying  drafts  of  merchants  or  other  in¬ 
dividuals  on  the  latter  place.  But  in  this  application  of  the  public  money  to  the 
purchase  of  drafts,  what  an  endless  field  would  there  be  for  undue  favors  to 
individuals,  as  well  in  discriminating  among  those  who  might  have  drafts  to  sell, 
as  in  adjusting  the  price  and  other  terms  of  the  purchase.  So,  likewise,  if  wo 
suppose  the  Receiver  General  at  New  York  authorized  to  draw  a  surplus  of  pub¬ 
lic  moneys  from  St.  Louis,  he  would  do  so  by  selling  drafts  on  the  Receiver 
General  at  St.  Louis ;  and  in  this  operation  of  selling,  there  would  be  precisely 
the  same  danger  of  abuse,  and  of  the  influence  of  personal  considerations,  as  I 
have  just  shown  to  exist  in  that  of  buying  exchange. 

It  is  also  very  easy  to  perceive  that,  under  the  forms  of  buying  and  selling 


10 


bills  of  exchange  by  Government  officers,  real  loans  to  individuals  may  be 
couched.  If  I  buy,  for  example,  a  bill  of  exchange  which  has  sixty  or  ninety 
days  to  run,  and  pay  for  it  in  cash ,  as  I  suppose  to  be  done  in  the  case,  put  above, 
of  a  Receiver  General  purchasing  bills  to  transfer  an  excess  of  public  mo¬ 
neys  in  his  hands,  what  is  this  in  fact  but  a  loan  of  money  to  be  returned,  at 
the  end  of  sixty  or  ninety  days,  at  some  other  place  where  the  Government 
wants  it.  It  is,  indeed,  except  as  to  place ,  the  ordinary  form  of  discounting 
mercantile  paper.  In  like  manner,  the  sale  of  a  bill  of  exchange,  to  be  paid  for 
at  a  future  day,  is  a  very  convenient  medium  of  a  real  loan.  The  purchaser 
immediately  sells  the  bill  he  has  bought,  realizes  it  in  money,  the  use  of 
which  he  enjoys  for  the  stipulated  period,  and  then  returns  it  with  the  rate  of 
profit  agreed  upon  in  the  nominal  purchase.  The  transaction  is,  to  every 
practical  intent,  a  loan  ;  and  professional  gentlemen,  conversant  with  the  devices 
practised  to  evade  the  statutes  against  usury,  will  tell  you  that  nothing  is  more 
common  than  to  make  a  real  loan  under  this  very  form  of  selling  a  bill  of  ex¬ 
change.  We  see,  then,  that  the  officers  of  the  Treasury,  under  the  organization 
provided  by  this  bill,  would  not  only  be  engaged  in  buying  and  selling  bills  of 
exchange,  but  they  would  have  the  power  of  discounting  mercantile  paper  and 
making  real  loans.  Thus  the  bill  creates,  in  effect,  a  bank  of  discount. 

It  would,  moreover,  be  a  bank  of  deposite,  for  the  27th  section  of  the  bill  ex¬ 
pressly  authorises  individuals  to  deposite  money  in  the  “  Treasury,  or  at  such 
other  points  as  the  Treasurer  may  designate,”  the  receipts  for  which,  it  is  declared, 
shall  be  current  in  the  several  land  offices  as  cash.  This,  I  am  aware,  is  but  a 
special  and  limited  provision,  confined  at  present  to  payments  in  advance  for 
public  lands.  But  the  principle  being  once  introduced,  will,  from  time  to  time, 
be  extended  to  other  cases.  I  shall  hereafter  have  occasion  to  show7  that  presi¬ 
dent  Jackson,  when  he  suggested  the  idea  of  a  Government  Bank,  of  which 
this  bill  seems  to  be  the  development,  expressly  recommended  that  it  should  be 
based  upon  individual ,  as  well  as  the  public  deposites. 

The  organization  instituted  bv  this  bill  would  also  be  a  bank  of  circulation , 

•  for  the  drafts,  receipts,  and  other  paper  authorized  to  be  issued  by  the  officers  of 
the  treasury,  under  the  provisions  of  the  bill,  would  form  a  part  of  the  actual 
currency  and  circulation  of  the  country.  That  it  is  designed,  through  the  medium 
of  this  machinery,  to  issue  permanently  a  government  paper  currency,  under 
some  form  or  other,  is  sufficiently  evinced  by  the  alternative  clause  of  the  bill 
relating  to  receipts  and  payments  by  the  government,  wdiich  requires  that  all 
such  receipts  and  payments,  after  a  certain  period,  shall  be  in  gold  or  silver,  “  or 
in  notes,  bills,  or  paper  issued  under  the  authority  of  the  United  States.”  The 
senator  from  South  Carolina,  (Mr.  Calhoun,)  the  patron  and  champion  of  this 
11,  and  the  author  of  the  provision  just  referred  to,  is  known  to  advocate  a  pa¬ 
ir  currency  of  that  description,  issued  and  resting  exclusively  on  the  credit  of 
ie  Government.  The  Secretary  of  the  Treasury  too,  in  his  report  on  the 
lances,  at  the  commencement  of  the  present  Session,  does  not  hesitate  to  ask 
ongress  for  the  permanent  grant  of  an  authority  to  issue  Treasury  Notes ,  (at 
s  discretion,  within  a  certain  limit,)  according  to  the  varying  wants  of  the 
reasury.  But  the  design  of  supplying  a  paper  medium,  for  general  circulation, 
irough  the  fiscal  action  of  the  Government,  is  more  fully  developed  in  the 
•port  of  that  officer  at  the  last  Session,  and  from  that  document,  I  beg  leave 
read  to  the  Senate  a  few  significant  extracts. 

“  Should  Congress,”  says  the  Secretary,  “  determine  that  it  is  proper  to  furnish  by  its  own 
ithority,  and  for  the  purposes  before  mentioned,  some  paper  medium  of  higher  character , 
d  other  than  what  now  exists  in  private  bills  of  exchange,  or  notes  of  State  Banks ,  no  doubt 
ists,  that  any  benefits  which  may  occasionally  be  derived  from  its  employment  can  be  rea- 
ty  secured,  without  treading  on  the  debateable  ground  of  either  the  power  or  the  policy  of 
artering  a  National  Bank.  Certificates,  not  on  interest,  but  payable  in  specie  to  bearer  or 


11 


order,  as  well  as  being  receivable  for  all  public  dues,  could  be  authorized  to  be  given  in 
payment  to  the  public  creditor,  whenever  preferred  by  him,  and  sufficient  specie  existed  in 
the  Treasury.  This  kind  of  paper  would  be  very  convenient  in  form,  and  would  differ 
little  from  the  drafts  now  in  use  on  banks,  except  being  drawn  on  a  known  specie  fund, 
and  expressing  on  its  face  not  only  this,  but  its  being  receivable,  in  the  first  instance,  for  all 
public  dues.  It  would  possess  the  highest  credit  attainable  in  society.”  “  The  common  drafts 
of  this  Department,  in  the  present  convenient  form,  possess  one  advantage,  which  could  be 
imparted  to  the  certificates.  When  used  at  places  against  which  the  balance  of  trade  exists, 
but  drawn  on  places  in  whose  favor  it  is,  the  former  do  now,  and  may  hereafter,  not  only 
facilitate  essentially  the  domestic  exchanges ,  but  at  the  same  time,  supersede  numerous  bank 
transfers,  and  the  more  expensive  transportation  of  specie  itself.” 

The  Mint  certificates,  heretofore  given  on  the  deposite  of  bullion  and  specie  for  coinage, 
might  be  easily  made  running  to  bearer  or  order,  and  receivable  for  all  public  dues;  and,  in 
that  way,  would  contribute  to  the  same  desirable  ends.” 

“  It  must  be  obvious  that  the  paper  of  any  bank  would  be  less  safe  and  useful  in  being 
received  for  public  dues,  in  proportion  as  if  may  want  such  solid  securities  and  foundations 
as  the  certificates  before  described.” 

My  purpose  is  not  now  to  discuss  the  supposed  advantages  of  this  Government 
paper  currency,  so  much  lauded  by  the  Secretary.  The  great  recommendation 
of  it,  in  his  eyes,  is  that  it  would  rest  upon  a  specie  basis  co-extensive  with  the 
issues.  But  as  the  certificates  would  be  rarely  returned  for  redemption,  nothing 
would  be  more  likely  to  happen  than  what  occurred  in  the  case  of  the  bank  of 
Amsterdam — that,  in  the  mean  time,  large  portions  of  the  specie  would  be 
withdrawn  and  diverted  to  other  purposes.  But  my  intention  was  simply  to  show 
that  an  issue  of  a  government  paper  currency,  in  some  form  or  other,  is  one  of 
the  main  objects  of  this  new  financial  scheme.  In  looking  at  the  passages  above 
quoted,  and  others  of  similar  import  in  the  Report  of  the  Secretary  of  the  Trea¬ 
sury,  it  is  impossible  to  wink  so  hard  as  not  to  see  that  the  design  is  to  supply  a 
paper  medium ,  through  the  fiscal  operations  of  this  government,  which,  it  is 
hoped,  would  ultimately  supersede  the  state  currencies ;  and  the  organization 
proposed,  in  this  bill,  is  the  instrument  by  which  that  design  is  to  be  accom¬ 
plished.  That  it  would  be  a  bank  of  circulation  is  unquestionable  ;  and  I  have 
already  shown  that  it  would  be  a  bank  both  of  discount  and  deposite. 

The  Secretary  of  the  Treasury,  however,  seems  to  think  there  would  be  no 
Bank  in  all  this,  because  there  would  be  no  incorporation.  But  incorporation  is 
not  necessary  to  constitute  a  bank,  which  derives  its  character  wholly  from  the 
nature  of  its  business  and  functions.  The  Government  Bank  of  Russia  is  not 
incorporated. — Neither  is  the  Government  Bank  of  Austria.  They  are  both 
constituted  of,  and  managed  by,  officers  of  the  Government,  precisely  as  the 
machinery  created  by  this  bill  is  proposed  to  be  managed  and  directed.  So 
in  regard  to  the  private  and  joint  stock  banks  of  England.  They  are  not  in¬ 
corporated  ;  but  no  body  ever  supposed  them  to  be  the  less  banks  on  that  account. 
Some  thirteen  or  fourteen  years  ago,  the  celebrated  Mr.  Ricardo  proposed  the 
plan  of  “  a  National  Bank ”  in  England,  which,  among  other  things,  was  to  have 
the  exclusive  privilege  of  issuing  the  whole  paper  currency  of  the  kingdom.  It 
was  to  be  a  Government  institution,  consisting  of  five  commissioners,  residing  in 
London,  to  be  appointed  by  the  crown  and  removable  by  Parliament,  and  to 
be  assisted  by  agents  and  officers  established  in  the  leading  country  towns.  The 
plan  of  this  bill  bears,  in  some  respects,  so  close  a  resemblance  to  that  of  Mr. 
Ricardo,  that  it  is  difficult  to  resist  the  impression  that  the  one  must  have  sug¬ 
gested  the  other.  The  organization  proposed  by  Mr.  Ricardo,  consisted,  like 
that  of  this  bill,  of  public  officers,  having  certain  duties  and  functions  assigned  to 
them,  connected  with  the  collection  and  management  of  the  public  revenue,  as 
well  as  with  the  issue  of  a  paper  currency.  No  act  of  incorporation  was  pro¬ 
posed  or  deemed  necessary  ;  but  he  did  not,  on  that  account,  the  less  consider  his 
scheme  a  “  National  Bank,”  under  which  name  it  was  expressly  presented  to 
his  countrymen. 

But  there  is  another  authority  on  this  head  still  more  in  point.  It  remounts  to 


12 


the  first  suggestion  ever  made  in  this  country  of  a  Government  or  Treasury 
Bank.  I  allude,  of  course,  to  President  Jackson,  who  in  his  first  annual  mes¬ 
sage  to  Congress,  (1829,)  threw  out  the  idea  of  a  bank,  founded  on  the  “credit 
and  resources  of  the  United  States.”  This  suggestion  became  the  subject  of 
very  able  and  elaborate  examination  by  the  Committees  on  Finance,  in  this 
and  the  other  House,  by  both  of  which,  though  consisting  of  warm  friends  of 
the  President,  the  suggestion  was  repudiated  and  exploded.  The  President, 
in  his  message  at  the  commencement  of  the  following  Session  of  Congress, 
(December,  1830,)  thought  proper  to  recur  to  the  subject,  and  to  define  more  pre¬ 
cisely  what  he  meant  by  a  bank  founded  on  “  the  credit  and  resources  of  the 
United  States.”  The  scheme  he  then  brought  forward  was  identical,  in  every 
respect,  with  that  contained  in  the  present  bill ;  and  yet,  with  the  soldierly  frank¬ 
ness  which  characterised  him,  he  did  not  hesitate  to  call  it  by  its  proper 
name — “  a.  Bank  of  the  United  States.”  Let  us  see  what  he  said  on  that 
occasion. 

“  In  the  spirit  of  compromise  and  improvement  which  distinguishes  our  country  and  its 
institutions,  it  becomes  us  to  enquire  whether  it  be  not  possible  to  secure  the  advantages 
afforded  by  the  present  Bank,  through  the  agency  of  a  Bank  of  the  United  States,  so  modified 
in  its  principles  and  structure,  as  to  obviate  constitutional  and  other  objections.  It  is  thought 
practicable  to  organize  such  a  Bank ,  with  the  necessary  officers,  as  a  branch  of  the  Treasury 
Department,  based  on  the  public  and  individual  deposites,  (without  power  to  make  loans 
or  purchase  property,)  which  shall  remit  the  funds  of  the  Government,,  and  the  expenses  of 
which  may  be  paid,  if  thought  advisable,  by  allowing  its  officers  to  sell  bills  of  exchange  to 
private  individuals,  at  a  moderate  premium,  &c.,  &c.,  &c.  In  times  of  public  emergency, 
the  capacities  of  such  an  institution  might  be  enlarged  by  Legislative  provisions” 

The  Bank  which  Gen.  Jackson  proposed,  was  to  be  organized,  with  the  neces¬ 
sary  officers,  as  a  branch  of  the  Treasury  Department,  to  be  based  on  the  public 
and  individual  deposites ,  to  remit  the  funds  of  the  Government ,  and  to  deal  in  bills  of 
exchange.  The  organization,  provided  by  the  bill  under  consideration,  is  to  pos¬ 
sess  every  one  of  these  attributes,  and  to  perform  other  banking  functions  in  ad¬ 
dition,  such  as  the  issue  of  paper,  which  was  not  then  contemplated.  Yet,  while 
the  former  plan  was  boldly  avowed  to  be  a  Bunk ,  this  is  denied  to  be  one.  Gen. 
Jackson,  with  all  his  popularity  and  energy  of  purpose,  was  not  able  to  commend 
his  plan  to  the  favor  of  the  country,  and  even  his  volonte  defer,  (iron  will,)  as  it 
was  called  by  a  foreign  representative,  on  a  memorable  occasion,  obeying  the 
great  law  of  Republicanism,  bent  beneath  the  force  of  public  opinion,  and  aban¬ 
doned  the  scheme.  Yet  the  same  scheme  is  now  reproduced,  amid  the  confu¬ 
sion  of  the  times,  in  an  aggravated  form,  but  without  the  name. 

It  is  a  remarkable  circumstance,  Mr.  President,  that  the  most  ancient  and 
celebrated  Banking  Institutions  of  Europe  have  grown  up  from  precisely  such 
beginnings  as  are  contained  in  this  bill.  The  Bank  of  Venice,  for  example,  the 
oldest  and  most  celebrated  bank  in  Europe,  commenced  as  a  fiscal  institution. 
The  Republic,  pressed  by  its  foreign  wars,  was  compelled  to  resort  to  a  forced 
loan.  In  order  to  secure  the  payment  of  the  interest  on  this  loan,  it  set  apart  cer¬ 
tain  branches  of  the  public  revenue,  and  instituted  a  board  of  commissioners,  call¬ 
ed  the  Chamber  of  Loans,  who  were  charged  with  the  collection  and  manage¬ 
ment  of  those  branches  of  the  revenue,  and  the  application  of  their  proceeds  to 
the  punctual  payment  of  the  interest  on  the  loan.  In  the  transaction  of  the  bu¬ 
siness  confided  to  them,  they  had  occasion  sometimes,  to  buy  and  sell  Bills  of 
Exchange,  as  I  have  shown  the  officers  of  the  Treasury,  under  the  organization 
of  this  bill,  would  do.  Having  frequently  surplus  funds  on  hand,  they  began  at 
length  to  employ  them  more  extensively  in  the  operation  of  buying  and  selling 
exchange,  and  under  this  power,  actually  advanced  money  on  mercantile  paper,  or 
in  other  words,  became  a  Bank  of  discount.  The  credit  and  responsibility  of  the 
institution  being  established,  the  merchants  of  Venice  began  to  make  use  of  it 
for  the  safe-keeping  of  their  funds,  and  so  it  became  a  bank  of  deposite 


13 


also.  Finally,  a  credit  on  the  books  of  the  institution  for  money  deposited,  be  g 
equivalent  to  cash,  payments  in  the  course  of  trade,  came  to  be  made  by  transfers 
of  these  credits  from  one  to  another,  or  by  what  are  now  called  checks,  which 
performed  the  office,  and  preceded  the  introduction  of  notes ,  and  so  the  chamber 
of  loans  became  also  a  bank  of  circulation.  We  see,  in  this  example,  by  what 
natural  and  easy  gradations  the  most  celebrated  banking  institution  in  Europe, 
that  which  has  been  the  model  of  all  the  rest,  grew  out  of  the  simple  function  of 
collecting  and  applying  the  public  revenue,  associating  to  itself  a  collateral  and 
incidental  action  on  the  commerce  and  currency  of  the  country,  all  of  which  func¬ 
tions,  I  have  shown,  are  to  be  vested  by  the  new  financial  scheme  in  the  officers 
of  the  Treasury  Department. 

The  same  in  every  material  respect,  were  the  origin  and  progress  of  the  Bank 
of  Genoa;  which,  next  to  that  of  Venice,  was  the  oldest,  and  in  its  dav,  the  most 
accredited  banking  institution  in  Europe.  In  England,  too,  the  mint,  at  one  time 
in  being  made  the  depository  of  the  funds  of  individuals,  as  the  Secretary  of  the 
Treasury  proposes  that  our  mint  and  its  branches  should  be,  became  virtually 
a  hank — “  the  great  centre  of  money  transactions  and  remittances  for  England 
and  foreign  nations”— till  Charles  the  1st,  in  1640,  impelled  by  his  necessities,  vio¬ 
lated  the  private  funds  deposited  there,  and  “  happily,”  as  Burke  says,  put  an 
end  to  both  its  credit  and  use  as  a  banking  establishment. 

The  testimony  of  history  then,  as  weil  as  the  nature  of  things,  proves  that 

the  organization  instituted  by  this  bill,  would  work  as  a  great  government  bank _ 

buying  and  selling  exchange — under  that  form,  at  least,  d iscountino-  mercantile 
paper, — receiving  de.posi.tes,  public  and  private, — and  circulating  a  paper  money 
of  its  own.  Now,  L  would  appeal  to  every  friend  of  the  liberties  of  his  country, 
and  ask  him  if  he  would  willingly  see  so  formidable  an  union  of  the  moneyed 
and  political  power  consummated  in  the  hands  of  the  government.  Will  lie  put 
so  potent  an  engine,  an  instrument  so  efficacious  of  operating  on  the  hopes  and 
fears  of  men,  of  enlisting  their  interests,  of  controiing  their  fortunes,  into  the  hands 
of  a  Department  of  the  government,  already  armed  with  a  patronage  and  power 
of  fearful  extent.  ? 

The  honorable  Senator  from  New  York,  (Mr.  Wright)  in  a  portion  of  hisre^ 
marks  which  seemed  to  be  intended  specially  for  the  benefit  of  those  of  us  who  are 
still  for  employing  the  State  Banks  as  depositories,  and  whom  he  described  as 
a  very  small  fraction,  said  that  the  real  and  only  alternative  before  the  country 
is  the  Sub-treasury  scheme  or  a  National  Bank.  Now,  sir,  unless  the  observa¬ 
tions  I  have  made  on  the  practical  operation  of  the  Sub-treasury  scheme  are 
founded  in  the  grossest  delusion,  that  scheme,  instead  of  being  antao-onistical  to  a 
National  Bank,  is.  in  every  respect,  identical  with  it.  It  would  be  a  National 
Bank  under  the  worst  possible  form.  A  National  Bank  in  the  hands  of  the  Exe¬ 
cutive,  controled  and  managed  exclusively  by  Executive  agents.  If,  then  the  ho¬ 
norable  Senator  will  insist  upon  making  up  an  issue,  to  which  the  Miosf  of  that 
thrice-slain  monster,  the  Bank  of  the  United  States  must  be  a  party,  he  must 
amend  his  pleadings  according  to  the  real  state  of  the  case,  and  submit  to  the 
country  this  question — Will  you  have  a  great  government  bank  in  the  hands  and 
under  the  control  of  Executive  officers,  or  will  you  have  an  incorporated  National 
Bank,  designed  to  be  a  business  concern  and  not  a  political  engine  ?  When 
this  issue  shall  be  presented,  if  indeed,  it  ever  shall  be,  let  me  tell  the  honorable 
Senator  that  there  are  those  whose  opposition  to  a  National  Bank  is  as  true  as  his 
or  that  of  any  other  man,  who  would  pause  long,  before  they  would  permit  the  ter¬ 
ror  of  any  alternative  to  drive  them  inlo  the  support  of  a  scheme,  like  that  of  the 
honorable  Senator,  which  they  believe  to  be  fraught  with  the  most  serious  danger 
to  the  liberties,  and  certain  destruction  to  the  best  interests  of  their  country. &  I 
shall  hereafter  endeavor  to  show  that  the  true  and  only  means  of  averting  either 
an  incorporated  National  Bank  or  a  great  government  Bank  is  to  sustain  the  state 


14 


ft 


institutions,  and  to  employ  their  agency,  with  such  modifications  and  securities  as 
experience  may  have  shown  to  be  either  necessary  or  desirable. 

1  wish,  however,  for  the  present  to  pursue  the  remarks  which  the  honorable 
Senator,  with  “  so  much  charity,”  to  use  his  own  expression,  addressed  to  that 
small  fraction  of  erring  and  obstinate  brethren,  sometimes  ’ycleped  conservatives. 
The  name,  1  believe,  sir,  has  not  been  of  their  own  choosing  ;  but  gentlemen  who 
are  well  read  in  the  history  of  parties  will  not  fail  to  remember  that  the  most 
odious  and  reproachful  designations  applied  to  them  by  their  adversaries  have 
become  endeared  by  the  persecutions  of  political  intolerance,  and  those  who  at 
first  felt  injured  and  insulted  by  the  application  of  a  political  nick-name,  have  at 
last  proudly  appropriated  it,  and  come  to  glory  in  it  as  a  memorial  of  their  strug¬ 
gles  and  a  symbol  of  their  principles.  Now,  sir,  I  do  not  know  that  there  is 
any  thing  in  this  name  of  conservative ,  as  applied  to  American  Institutions,  which 
an  American  patriot  ought  to  wish  to  disown.  It  implies  devotion  to  the  existing 
institutions  of  his  country — a  desire  to  preserve  and  defend  them — a  willing¬ 
ness,  and  even  zeal  to  reform ,  as  the  only  effectual  means  ol  preserving — but 
an  unconquerable  resistance  to  schemes  of  wild  innovation  and  destruction. — If 
this  is  what  is  meant  by  a  conservative ,  (and  such  is  the  true  and  proper  import 
of  the  term,)  then,  sir,  1  proudly  avow  myself  a  conservative — a  conservative  of 
Republican  institutions,  of  Republican  principles,  of  Republican  practices,  as  il¬ 
lustrated  and  interpreted  by  the  great  champions  of  the  Republican  faith. 

But,  sir,  to  pursue  the  remarks  of  the  honorable  Senator,  addressed  to  this 
small  fraction  of  his  political  brethren. — He  tells  them  that  their  plan  has  very  few 
supporters  in  either  House  of  Congress — that  there  are  two  great  parties  in  Con¬ 
gress ,  one  for  the  Sub-treasury  scheme,  and  the  other  for  a  National  Bank — and 
he  sees,  therefore,  no  prospect  of  success  for  any  middle  ground.  He  then  as¬ 
sumes  that  the  state  of  public  sentiment  among  the  people  corresponds  to  this 
division  of  opinion  in  Congress.  I  must  say,  with  all  my  respect  for  the  gentle¬ 
man’s  knowledge  and  skill  in  the  statistics  of  party,  that  this  assumption  is  not 
warranted  under  the  circumstances  of  the  case,  nor  does  it  seem  to  me  sound 
in  principle.  It  implies  that  the  organization  and  array  of  parties  here  is  to  give 
law  to  public  opinion,  and  that  public  opinion  is  not  to  shape  and  control  the  action 
of  parties  here.  Sir,  I  go  for  the  voice  of  the  people ;  and  the  people  have 
spoken  for  themselves.  They  have  not  left  us  to  infer  their  sentiments  from  anv 
accidental  or  temporary  relation  of  parties  here.  They  have  pronounced  judgment 
on  the  gentleman’s  scheme  ;  and  1  should  like  to  know  where  the  honorable  gen¬ 
tleman  finds,  in  these  expressions  of  public  opinion,  any  evidence  that  there  is 
a  great  party  in  this  country  in  favor  of  the  Sub-treasury  project.  Never  before 
has  any  proposition  been  so  signally  rebuked  and  condemned  by  the  voice  of  the 
•  people.  I  refer  to  these  things,  Mr.  President,  with  no  pleasure.  I  contributed 
my  best  exertions  to  the  election  of  the  present  Chief  Magistrate,  honestly  an¬ 
ticipating  from  his  prudence,  his  abilities,  and  his  patriotism,  a  wise  and  success¬ 
ful  administration  of  the  public  affairs.  No  one  has  felt  a  more  sincere  desire  for 
his  success  than  I  have  done.  The  unfavorable  manifestations  of  public  senti¬ 
ment,  therefore,  upon  the  first  leading  measure  of  his  administration,  (though  I 
foresaw  and  foretold  them,  from  the  first,  moment  that  that  measure  was  suggested,) 
have  been  to  me  the  source  of  any  thing  rather  than  pleasure.  They  have  now, 
however,  become  matters  of  public  history;  and  as  the  Senator  from  New  York 
seems  disposed  to  confine  our  view  here  for  second-hand  proofs  of  public  opinion 
on  the  merits  of  the  different  financial  measures  which  have  been  proposed,  I  must 
beg  leave  to  invite  his  attention  to  those  more  majestic  displays  of  public  senti¬ 
ment  which  have  been  presented  on  the  great  theatre  of  the  nation.  Let  him 
look  at  the  elections  which  have  taken  place  in  the  several  States,  since  this 
fatal  measure  was  first  broached  in  the  official  journal,  and  say  how  many  of 
them  have  eventuated  in  favor  of  the  administration.  With  one  or  two  excep- 


15 


tions,  they  have  all  terminated  against  it;  and  mainly,  there  is  reason  to  believe, 
on  account  of  this  very  measure. 

Where,  then,  does  the  Honorable  Senator  find  the  evidence  that  there  is  any 
great  body  of  popular  sentiment  in  this  country  in  favor  of  his  scheme  ?  The 
evidence  is  all  the  other  way,  and  of  the  most  overwhelming  force.  So,  as  to  the 
other  great  alternative  of  which  the  Honorable  Senator  speaks,  (a  National  Bank,) 
a  large  majority  of  the  people  have  repeatedly  declared  against  it,  and  without  im¬ 
puting  to  them  a  degree  of  fickleness,  of  which  1,  at  least,  do  not  suspect  them, 
they  must  still  be  opposed  to  it.  What  plan,  then,  will  they  rally  to,  as  a  safe  and 
practical  substitute  for  the  Sub-treasury  on  the  one  hand,  or  a  National  Bank  on 
the  other  ?  It  is  the  employment  of  the  State  Banks,  institutions  intimately 
connected  with  their  domestic  interests,  responsible  to,  and  supervised  by,  their 
domestic  authorities,  and  exempt  from  all  danger  of  political  combination — the 
employment  of  these  institutions  under  regulations  which  shall,  at  the  same 
time,  secure  their  efficiency  and  guard  against  abuse.  Such,  I  am  firmly  per¬ 
suaded,  would  be,  at  this  moment,  the  unbiassed  decision  of  a  large  majority  of 
the  American  people.  And  even  if  we  appeal  to  the  criterion  set  up  by^the 
honorable  Senator  from  New  York — the  state  of  parties  in  Congress — I  think  we 
may  deduce  from  that,  conclusions  far  more  favorable  to  the  State  Bank  depo- 
site  system  than  he  has  drawn.  If  there  be  but  a  small  party  in  Congress,  with 
whom  the  State  Bank  deposite  system  is  a  first  choice,  he  must  admit  that  it  is 
the  second  choice  of  a  large  majority.  The  Sub-treasury  party  would,  I  pre¬ 
sume,  prefer  it  to  a  National  Bank,  and  the  National  Bank  party  would  prefer 
it  to  the  Sub-treasury.  Now,  sir,  the  honorable  gentleman  will  permit  me  to 
refresh  his  early  reading,  by  reminding  him  of  an  incident  related  by  Plutarch. 
Afier  the  battle  of  Salamis,  in  which  the  power  of  the  Persian  monarch  was 
crushed  by  the  combined  Grecian  fleet,  the  different  commanders  of  the  squadron 
repaired  to  the  altar  of  Neptune,  and  according  to  a  custom  of  the  country  and  the 
times,  each  one  put  on  a  ticket  the  names  of  those  who  had  rendered  the  most 
important  service  in  the  action.  Every  officer  put  upon  his  ticket  his  own  name 
first,  but  all  put  the  name  of  Themistocles  next.  This  has  been  held,  in  all 
future  times,  as  conclusive  proof  of  the  superiority  of  Themistocles  above  all  his 
competitors;  and  the  State  Bank  deposite  system  may  adduce  the  same  evidence 
of  its  merit  in  being  the  second  choice  of  both  of  the  parties  which  respectively 
advocate  the  Sub-treasury  and  a  National  Bank.  The  fraction,  therefore,  in 
Congress,  who  still  adhere  to  that  system,  however  small  they  may  appear  in  the 
eyes  of  the  honorable  Senator,  can  see  nothing  in  this  state  of  things,  which 
calls  upon  either  their  patriotism  or  their  prudence  to  abandon  a  policy  which 
they  believe  to  be  sanctioned  by  the  sentiments,  and  demanded  by  the  interests, 
of  the  great  body  of  the  people. 

But,  sir.,  to  return  from  this  digression,  let  us  see  what  additions  are  made  to 
the  official  as  well  as  pecuniary  patronage  of  the  Executive,  by  the  provisions  of 
this  hill.  When  I  had  the  honor  of  addressing  the  Senate  at  the  last  session,  I 
spoke  of  the  bill  then  under  consideration,  as  the  “grain  of  mustard  seed,”  which 
would  grow  up  into  a  large  tree  and  cover  the  land  with  its  branches.  But  I  was 
told  by  the  honorable  Senator  from  New  York  and  others,  that  the  bill  did, 
not  create  a  single  new  officer,  and  my  friend  from  Connecticut,  (Mr.  Niles) 
complimented  me,  as  well  as  I  remember,  for  my  vivid  imagination,  to  the  account 
of  which  alone  he  set  down  the  apprehensions  I  had  expressed.  But  what  do 
we  now  see?  In  three  short  months,  the  tree,  which  has  already  grown  up  from 
this  grain  of  mustard  seed,  has  thrown  out  four  large  branches  in  the  form  of 
Receivers  General,  each  of  which  will  have  its  dependent  ramifications  in  the 
form  of  cashiers,  tellers,  clerks,  &c.  The  Treasurer  also  is  to  have  his  “assist¬ 
ants  ;”  and  an  indefinite  brood  of  clerks  is  provided  for  all  the  officers  made  depo¬ 
sitaries  of  the  public  moneys  under  the  bill,  to  assist  in  the  discharge  of  the  new 


16 


duties  devolved  on  them.  Finally,  a  number  of  missionaries  are  to  be  appointed 
from  time  to  time,  at  the  discretion  of  the  Secretary  of  the  Treasury,  to  visit  and 
inspect  the  various  fiscal  agencies  created  by  the  bill.  Now,  here  is  a  cloud 
of  new  executive  officers,  at  once,  which  bids  defiance  to  calculation.  But  if  their 
present  number  could  be  estimated,  (as  the  Senator  from  New  York  has  attempted 
to  do,)  it  would  be  altogether  useless,  for  they  must,  from  the  nature  of  things, 
be  constantly  and  rapidly  multiplying.  Would  the  honorable  Senator  attempt  to 
measure  the  rising  cloud,  which  threatens  to  overspread  and  blacken  the  whole 
face  of  the  heavens,  by  the  speck,  “  no  bigger  than  a  man’s  hand,”  which  has 
just  appeared  on  the  edge  of  the  horizon  ?  This  is  but  the  beginning ;  and  we 
all  know  with  what  vigor  and  fruitfulness  every  thing  grows  on  American  soil. 
Receivers  General  are  allowed  by  the  bill,  at  present,  only  to  Massachusetts, 
New  York,  South  Carolina,  and  Missouri.  But  will  not  Maine,  New  Hamp¬ 
shire,  Connecticut,  demand  their  Receivers  General  as  well  as  Massachusetts, — 
Virginia,  North  Carolina,  and  Georgia,  as  well  as  South  Carolina, — Kentucky, 
Ohio,  and  Tennessee,  as  well  as  Missouri  ;  and  so  in  regard  to  all  the  other 
States  that  are  now  pretermitted  in  the  bill.  If  we  have  Receivers  General,  we 
must  finally  have  Payers  General ;  for  this  is  an  integral  part  of  the  system  in 
France,  from  which  we  borrow  the  scheme  proposed  by  the  bill.  In  adopting  a 
system,  it  is  fair  to  presume  we  mean  to  adopt  its  usual  and  ordinary  concomitants. 
Indeed,  an  honorable  member  of  the  other  House,  who  is  well  skilled  in  questions 
of  finance,  expressed  the  opinion  to  me,  only  the  other  day,  that  the  functions  of 
paying  and  receiving  ought  to  be  separated,  so  as  to  form  checks  on  each 
other;  and  thus  we  shall  have  the  French  system,  in  both  its  branches,  at  once. 
On  the  question  of  introducing  a  new  system  of  policy,  we  ought  never  to  forget 
the  old  adage,  which  we  derive  from  France  also — c’est  le  premier  pasr  qui  coute 
— It  is  the  first  step  which  is  decisive ,  and  that  taken,  all  the  rest  follow. 

The  Senator  from  New  York  (Mr.  Wright)  has  likewise  attempted  an  estimate 
of  the  expense  of  this  new  system.  But  this,  also,  in  my  opinion,  is  a  vain 
thing.  The  first  modest  beginnings  of  a  system  furnish  no  standard  by  which 
its  ultimate  expense  can  be  measured.  The  Senator’s  estimate  makes  the  annual 
expense,  (exclusive  of  what  may  be  called  the  outfit ,  in  the  cost  of  buildings, 
&c.)  somewhere  about  $20,000,  (twenty  thousand  dollars.)  But  this  is  greatly 
below  the  estimate  of  the  Secretary  ol  the  Treasury,  in  his  report  at  the  last 
session;  and  in  recommending  a  favorite  scheme,  the  author  of  it  is  rarely 
found  to  over-estimate  its  expense.  That  officer  set  down  the  annual  expense 
at  $60,000  (sixty  thousand  dollars.)  This,  in  my  opinion,  is  very  far  below  the 
ultimate  permanent  expense.  An  able  and  experienced  gentleman  in  my  own 
State,  practically  versed  in  these  questions,  and  a  zealous  and  decided  advocate 
withal  of  the  new  system,  in  setting  forth  its  advantages,  and  defending  it  from  the 
objections  which  had  been  urged  against  it,  met  this  very  one  of  expense  by 
giving  it  as  his  opinion,  formed  upon  deliberate  and  careful  reflection,  that  the  an¬ 
nual  expense  would  not  exceed  $600,000,  (six  hundred  thousand  dollars.)  Now, 
sir,  when  I  arrived  here,  at  the  extra  session  of  Congress,  and  read  the  estimate 
of  the  Secretary  of  the  Treasury,  I  could  not  but  suppose,  at  first,  that  there 
was  an  accidental  mistake  in  his  figures,  by  the  omission  of  a  cypher,  and  that 
he  intended  to  have  put  down  the  expense  at  $600,000,  (at  six  hundred  thou¬ 
sand  dollars,)  instead  of  $60,000,  (sixty  thousand  dollars.) 

But,  however,  this  may  be,  nothing  can  be  more  certain  than  that  the  expense 
of  this  system,  when  fully  developed,  musl,  from  its  complexity,  and  the  number  of 
officers  it  will  call  for,  be  very  great.  We  have  a  standard  to  appeal  to,  on  this 
question,  which  is  worth  far  more  than  any  a  priori  reasonings.  The  system  has 
been  long  established  and  fully  tried  in  France,  and  we  know  its  actual  results 
there.  On  the  other  hand,  in  England  the  agency  of  banks  has  been  extensively 
used  in  the  collection  and  disbursement  of  the  public  revenue,  instead  of  the  indi- 


17 


victual  agencies  which  are  employed  in  France,  and  are  contemplated  by  this  bill. 
It  will  be  a  good  test  therefore,  of  this  question,  to  look  at  the  relative  expenses 
of  the  revenue  systems  of  France  and  England.  I  will  read  to  the  Senate  a 
comparative  statement  on  the  subject,  which  I  have  taken  from  the  work  of  a 
highly  respectable  American  traveller,  vouched  by  original  authorities,  to  which 
he  refers.  From  this  statement  it  appears  that  the  cost  of  collecting  the  revenue  in 
England  is,  under  the  respective  heads  of  taxation,  as  follows  :  Customs,  7  per 
cent. — excise,  4  per  cent — recording  and  stamps,  7  per  cent. — Post  Office  11 
percent. — and  direct  taxes,  2  per  cent. — averaging,  upon  the  whole,  6  1-5  percent. 
In  France,  under  the  same  heads,  the  cost  of  collecting  (he  revenue  is  as  fol¬ 
lows  :  Customs,  33  per  cent. — excise,  20  per  cent. — recording  and  stamps,  9 
percent. — Post-office,  45  per  cent. — direct  taxes,  15  per  cent. — averaging,  upon 
the  whole,  24  2-5  per  cent !  I  am  well  aware  that  divers  circumstances  are  to  be 
taken  into  consideration,  in  explaining  this  enormous  difference  of  expense  be¬ 
tween  the  French  and  English  fiscal  systems  ;  but  one  of  the  principal  causes  of 
that  difference,  (and  it  is  so  considered  by  the  writer,  to  whom  I  have  referred,) 
will,  at  last.,  be  found  in  the  fact  of  the  extensive  use  of  hanking  agency  in  the 
collection  of  the  revenue  in  England,  and  the  exclusive  employment  of  individual 
agency,  for  that  purpose,  in  France. 

But  it  is  not  merely  by  the  multiplication  of  officers  and  the  increase  of  ex¬ 
penditure,  that  the  influence  of  the  Executive  branch  of  the  Government  is  fear¬ 
fully  extended  by  this  bill.  That  influence  is  greatly  augmented  by  certain  new 
regulations  it  introduces  in  regard  to  the  tenure  of  office — the  compensation  of 
officers,  and  the  forms  and  usages  of  fiscal  administration.  In  the  first  place, 
the  Treasurer,  the  Receivers-General,  and  all  the  other  officers,  from  the  highest 
to  the  lowest,  employed  in  the  fiscal  service,  may  be  required  at  any  time,  at  the 
discretion  of  the  Secretary  of  the  Treasury,  to  give  new  official  bonds,  in  increas¬ 
ed  sums,  to  he  fixed  by  the  Secretary  of  the  Treasury,  “  any  law  in  reference  to 
any  of  the  official  bonds  of  any  of  the  said  officers  to  the  contrary  notwithstand¬ 
ing  and  in  default  of  giving  such  new  bond,  the  officer  would,  of  course,  be  de¬ 
prived  of  his  office.  Now,  it  is  evident,  that  under  such  a  power  possessed  by 
the  Secretary  of  the  Treasury,  all  the  officers  connected  with  the  operations  of  the 
Treasury,  would  be  converted  into  the  trembling  vassals  of  the  Executive.  A 
direct  removal  from  office  is  a  measure  of  more  than  ordinary  energy,  and  involves 
responsibility.  Cases  might  exist  in  which  the  Secretary  of  the  Treasury  would 
be  unwilling  to  take  the  responsibility  of  a  direct  removal  from  office,  and  yet 
would  accomplish  the  same  object  by  a  vexatious  requisition  of  a  new  bond  in 
so  large  a  sum,  that  the  officer  could  not,  or  would  not  find  sureties  to  the 
increased  amount.  Who  does  not  see  that,  under  such  a  regulation,  the  officers 
of  the  Treasury  would  lose  all  sense  of  independence  ;  and  that  those  who 
could  consent  to  hold  office  on  such  terms,  must  be  prepared  to  become  the  pas¬ 
sive  and  unresisting  tools  of  power.  Heretofore  it  has  been  the  wise  policy  of  our 
legislation  to  fix  by  law  the  sum  in  which  official  bonds  are  to  be  given,  and  to 
leave  nothing  in  that  respect,  or  as  little  as  possible,  to  Executive  discretion. 
Again,  it  will  be  seen  from  an  examination  of  the  bill,  that  the  compensation  of 
several  of  the  officers  to  be  appointed  under  it,  such  as  visiting  agents,  clerks,  &c. 
is  to  be  fixed  by  the  Secretary,  at  his  discretion,  and  not  by  law.  Here  is  another 
source  of  servile  dependence  on  the  one  hand,  and  of  increased  Executive  in¬ 
fluence  on  the  other,  which  is  not  in  harmony  with  the  general  spirit  and  maxims  of 
our  legislation. 

My  attention  has  also  been  attracted  by  a  provision  of  the  bill  which  seems  to 
me  to  introduce  a  most  dangerous  innovation  in  the  established  forms  and  usages 

o  _  _  o 

of  the  Treasury.  It  has  heretofore  been  a  fixed  principle  of  fiscal  responsibility, 
that  no  money  should  be  drawn  from  the  Treasury,  but  upon  a  warrant  of  the 
Secretary  drawn  on  the  Treasurer,  countersigned  by  the  Comptroller,  and  re- 

o 

tii 

\ 


IB 


corded  by  the  Register,  and  upon  that  warrant,  when  it  reaches  the  hands  of  the 
Treasurer  thus  authenticated,  the  Treasurer  draws  his  draft  on  the  depository  of 
the  public  money  for  payment.  These  forms  have  always  been  held  to  be  very 
important  checks,  and  indispensable  preliminaries  to  any  money  being  drawn  out 
of  the  Treasury,  or  in  other  words,  paid  by  the  depositary  of  the  public  mo¬ 
neys.  The  Secretary  draws  his  warrant  upon  the  Treasurer,  subject  to  the 
checks  before  mentioned,  and  then  the  Treasurer  draws  upon  the  depositary  who 
is  to  make  the  payment.  But,  in  no  instance,  does  the  Secretary  draw  directly 
upon  the  depository,  because  that  would  be  to  lose  the. security  of  the  intermediate 
checks  of  the  Comptroller  and  the  Register.  By  the  10th  section  of  this  bill, 
however,  in  contravention  of  these  established  principles  and  checks,  it  is  express¬ 
ly  provided,  that  ‘‘  for  the  purpose  of  payments  on  the  public  account,  it  shall  be 
lawful  for  the  said  Secretary  to  draw  upon  any  of  the  said  depositaries ,  as  he  may 
think  most  conducive  to  the  public  interest,  or  to  the  convenience  of  the  public 
creditors  or  both.”  Under  this  provision  the  Secretary  of  the  Treasury  could 
draw  out  all  the  money  in  the  Treasury,  or,  which  is  ihe  same  thing,  in  the 
hands  of  the  depositaries,  without,  any  check  whatsoever.  The  effect  of  it, 
whether  so  intended  or  not,  is  to  place  the  whole  public  treasure  at  his  unchecked 
and  absolute  disposal. 

Now,  sir,  is  not  the  effect  of  these  various  provisions,  and  of  the  whole  scope 
and  tenor  of  this  bill,  to  concentrate,  at  last,  the  entire  control  of  the  public 
moneys,  in  the  hands  of  the  President  ;  for  the  Secretary  of  the  Treasury,  and  all 
the  other  fiscal  officers  are  but  his  agents,  appointed  by  him,  and  removable  at 
his  pleasure  ?  But  the  Senator  from  New  York,  (Mr.  Wright,)  contends  that  the 
President  would  have  no  more  control  over  the  public  moneys  under  the  pro¬ 
posed  system,  than  if  they  were  deposited  in  banks — that  the  same  legal  formali¬ 
ties  must  be  gone  through  to  touch  the  public  moneys,  in  the  one  case,  as  in  the 
other.  It  may  be  true,  that  the  President  has  no  more  legal  control  over  the  pub¬ 
lic  money  in  the  one  case  than  in  the  other  ;  but  has  he  not  a  greater  practical 
control.  In  the  one  case,  the  depositaries  of  the  public  money  would,  be  his 
agents,  subject  to  his  authority,  the  creatures  of  his  will,  dependent  upon  bis  plea¬ 
sure  for  their  continuance  in  ^flice,  and  made  by  the  peculiar  provisions  of  this 
bill,  as  I  have  already  shown,  especially  and  habitually  sensible  of  that  depen¬ 
dence.  In  possessing  so  complete  a  control  over  the  keepers  of  the  public  mo¬ 
ney,  he  would  possess  virtually  a  control  over  the  public  money  itself.  But,  in  the 
case  of  the  employment  of  banks,  the  depositories  of  the  public  money  are  in¬ 
stitutions  not  created  by  the  President — not  dependent  on  him  for  their  contin¬ 
ued  existence  : — on  the  contrary,  they  hold  their  charters,  and  the  advantages 
they  confer,  from  a  distinct  authority,  to  which  they  are  at  all  times  responsible 
and  are  thus  guarded  against  any  undue  influences  from  other  quarters,  which 
might  warp  them  from  their  integrity  and  their  duties. 

In  making  these  remarks,  Sir,  I  speak  in  no  spirit  of  captious  jealousy,  as  to 
the  highest  Executive  trust  of  the  Government,  or  of  its  actual  incumbent:  but 
I  speak  in  the  spirit  of  the  constitution,  which  anticipates  the  danger,  and  sup¬ 
poses  the  possibility  of  the  abuse  of  power,  and  inculcates  the  necessity  of  guard¬ 
ing  against  it.  The  system  organized  by  this  bill  is  one  of  the  most  thorough 
centralization.  It  rides  over  the  institutions  of  the  States,  prostrates  their  credit 
and  usefulness,  brings  patronage  and  power  to  the  General  Government,  concen¬ 
trates  them  in  the  hands  of  the  Executive,  to  whom  it  gives  an  unlimited  con¬ 
trol  over  the  public  moneys,  and  through  the  banking  operations  to  be  founded 
on  them,  an  extensive  and  paramount  influence  upon  the  moneyed  concerns  of  the 
whole  country.  It  is  fitting  that  such  a  system  should  be  borrowed  from  France, 
the  country  whose  institutions  exhibit  the  most  unqualified  example  extant  of 
centralization — under  which  the  capital  has  swallowed  up  the  provinces,  and  Pa¬ 
ris  has  become  synonimous  with  France.  Bwt  it  is  equally  fitting  that  such  a 


19 


system  should  be  resisted,  to  the  last  extremity,  in  this  land  of  Republican  free¬ 
dom,  by  all  who  are  attached  to  the  rights  of  the  States — by  all  who  are  opposed 
to  the  enlargement  of  Federal  and  Executive  power — and,  by  all  who  watch  with 
jealousy,  and  view  with  alarm,  every  tendency  to  consolidation. 

I  will  now,  Mr.  President,  follow  the  Senator  from  New  York,  (Mr.  Wright,)  in 
the  remarks  he  made  on  the  comparative  safety  of  the  two  systems  proposed, 
for  keeping  and  disbursing  the  public  moneys.  Although  experience,  the  only 
safe  arbiter,  has  long  since  settled  this  question,  the  honorable  Senator  argued 
it  as  if  it  were  still  open  to  doubt,  and  made,  I  am  free  to  admit,  an  exceedingly 
ingenious  and  plausible  argument.  He  instituted  a  parallel  between  the  two 
systems,  in  regard  to  the  great  leading  points  on  which  their  safety  is  supposed  to 
depend,  and  in  each  instance  brought  out  a  substantial  equality.  First,  as  to  offi¬ 
cers,  he  said  it  would  be  fair  to  presume  that  the  officers  of  the  government  and  the 
officers  of  the  Banks  would  be  equally  trust-worthy — Then,  as  to  sureties ,  he 
said  both  the  banks  and  the  government  officers  are  equally  required  to  give  sureties, 
if  deemed  necessary.  So,  likewise,  as  to  vaults,  the  government  officers,  he  said, 
are  to  be  provided  with  vaults,  as  well  as  the  banks.  The  only  particular,  then, 
in  which  the  banks,  as  he  alledged,  could  be  supposed  to  present  a  better  guaran¬ 
tee  for  the  safety  of  the  public  funds,  is  that  their  capital  stock  is  pledged  for  the 
reimbursement  of  the  public  moneys  committed  to  them  ;  but  this  advantage  in 
favor  of  the  banks,  he  very  adroitly  balanced  by  what  he  represented  to  be  the 
risk  of  mingling  the  Government  funds  with  those  of  trading  corporations.  Now- 
all  this  is  very  fair  and  plausible  on  the  surface.  But  what  is  the  fact—- -what 
is  the  testimony  of  experience  ? 

While  the  honorable  gentleman  was  running  this  parallel  in  theory  between  the 
two  systems,  there  was  a  document  lying  on  the  table  of  the  other  House, 
which  had  run  the  same  parallel  on  the  surer  foundations  of  practice.  I  allude 
to  a  recent  report  of  the  Secretary  of  the  Treasury,  in  answer  to  a  call  of  that 
House,  at  the  Extra  Session,  made  on  the  motion  of  an  honorable  friend  of  mine, 
(Mr.  Garland,  of  Virginia,)  containing  a  list  of  all  “the  receivers,  collectors,  or 
depositories  of  the  public  money,  who  are  in  default  to  the  Government,  with  the 
amount  of  their  respective  defaults,  &c.”  What,  Sir,  does  this  document,  which 
I  now  have  before  me,  show  ?  'That  the  whole  amount  of  balances  due  from 
banks,  which  are  deemed  unavailable,  is  a  little  more  than  one  million  of  dollars, 
(1,046,649);  and  these  balances  go  back  to  a  period  long  past,  when  the  ex¬ 
traordinary  embarrassments  consequent  on  the  war  involved  banks  and  indi¬ 
viduals  in  difficulties,  beyond  any  former  or  subsequent  example.  In  relation 
to  the  banks,  which  have  been  recently  employed  as  depositories,  it  appears 
that  they  have  either  paid  up  all  they  owed  the  Government,  or  are  in  the  course 
of  paying  it  up  as  called  for  by  the  wants  of  the  public  service,  without  any 
apprehension  of  default  on  their  part,  or  availing  themselves  of  the  indulgence 
of  the  act  passed  at  the  late  Session  of  Congress,  have  either  secured,  or  are 
expected  to  secure,  satisfactorily,  the  payment  of  the  whole  balances  due  from 
them,  according  to  the  terms  of  that  act.  Only  eleven  of  them,  it  appears, 
out  of  near  ninety  employed  as  depositories,  have  even  asked  indulgence,  under 
the  act  here  referred  to,  and  but  a  single  one  of  them  has  been  ordered  to  be 
sued.  Now,  Sir,  when  we  look  to  the  list  of  individual  collectors  and  receivers — 
what  do  we  see  ?  An  aggregate  default  of  about  three  millions  !  and  though  some 
of  the  more  recent  balances  appearing  on  that  list,  may  be  reduced  by  future 
collections,  yet  from  the  long  standing  of  most  of  them,  there  is  no  reason  to 
believe  that  the  aggregate  amount  of  the  entire  list  will  be  affected,  in  any  sensible 
degree,  by  these  partial  recoveries.  It  is  to  be  remarked  too,  that  this  list  does 
not,  include  disbursing  officers ,  “  whose  indebtedness”  is  stated  by  the  Secretary 
“to  be  very  great,”  and  the  actual  losses  by  whom,  I  showed,  during  the  late  Ses¬ 
sion  of  Congress,  from  a  report  of  Mr.  Crawford,  to  have  “  greatly  exceeded”  a 


20 


million  and  a  half  of  dollars,  from  1789  to  1819,  and  by  this  time,  have  grown 
up,  in  all  probability,  to  another  aggregate  sum  of  three  millions!  Neither 
does  this  list  include  officers  of  the  Post  Office  department,  among  whom  it 
was  shown  by  official  documents,  at  the  last  annual  Session  of  Congress  that 
there  were  as  many  as  eighteen  hundred  and  thirty-two  defaulters  !  It  is  to  be 
observed  also,  that  this  list  is  confined  to  public  agents,  “  who  were  out  of  office  on 
the  12th  day  of  October,  1837.” 

Now,  sir,  if  the  Honorable  Senator  from  New  York  had  taken  the  trouble  to 
look  at  this  document,  before  he  made  his  speech,  he  might  have  saved  himself 
the  labor  of  a  great  deal  of  superfluous  ingenuity.  In  contrasting  the  ingenuity  of 
his  argument  with  the  blunt  contradiction  of  facts  which  this  document  presents, 
1  was  strongly  reminded  of  an  anecdote  I  have  often  heard  of  the  late  venera¬ 
ble  Bishop  Madison,  of  Virginia.  That  excellent  prelate  was  also  a  profound 
philosopher,  and  much  addicted  to  philosophizing.  On  one  occasion,  he  under¬ 
took  to  explain  why  the  shade  of  a  lamp,  almost  in  contact  with  the  flame  of  the 
candle  beneath,  w  as  not,  in  any  degree,  heated  by  it.  This  he  did  by  a  learned 
dissertation  on  the  laws  of  caloric,  and  all  the  other  scientific  data  which  could 
be  brought  to  bear  on  the  subject.  Having  completely  satisfied  himself,  and  the 
admiring  audience  which  surrounded  him,  of  the  truth  of  his  theory,  he  conld  not 
avoid,  in  the  consciousness  of  his  triumph,  putting  his  hand  on  the  lamp  shade, 
which  had  been  the  subject  of  his  disquisition,  when  an  exclamation  of  acute 
pain  disclosed  the  fact  that  his  hand  had  been  severely  burnt  in  the  application. 
Nature,  thus,  contradicted  the  philosopher,  and  so,  stubborn  facts  w  ill  sometimes 
confute  the  most  astute  logician.  1  cannot  but  think  that  if  the  Honorable  Senator 
from  New  York  at  the  close  of  his  very  ingenious  argument,  had  laid  his  hand 
upon  this  document,  he  must  have  felt  his  lingers,  at  least,  a  little  scorched. 

Has  the  Honorable  Senator  forgotten  the  emphatic  testimony,  deduced  from 
a  careful  collation  of  facts,  borne  by  the  present  Secretary  of  the  Treasury,  only 
three  years  ago,  to  ihe  superior  safety  of  banks  as  depositories  of  the  public 
money?  Let  me  then,  refresh  his  recollection  by  reading  to  him  and  the 
Senate,  an  extract  from  the  able  report  of  that  officer,  made  to  Congress,  in  De¬ 
cember  1834,on  the  system  of  keeping  and  disbursing  the  public  money.  “  It 
is  a  singular  fact,”  says  the  Secretary,  “  in  praise  of  this  description  of  public 
debtors,  the  .selected  banks ,  that  there  is  not  now  due  on  deposites,  from  the  whole 
of  them  which  have  now  stopped  payment,  from  the  establishment  of  the  Con¬ 
stitution  t.o  the  present  moment,  a  sum  much  beyond  what  is  now  due  to  the 
United  States  from  one  mercantile  firm  that  stopped  payment  in  1825  or  1826,  and 
of  whom  ample  security  wms  required  and  supposed  to  be  taken  under  the  re¬ 
sponsibility  of  an  oath.  If  we  include  the  whole  present  dues  to  the  govern¬ 
ment  from  discredited  banks,  at  all  times  and  of  all  kinds,  whether  as  depositories 
or  not  and  embrace  even  counterfeit  bills  and  every  other  species  of  unavailable 
funds  in  the  Treasury,  they  will  not  exceed  what  is  due  from  two  such  firms” 
He  then  continues,  “  If  our  former  small  losses  by  them,  (the  banks,)  in  keeping 
and  paying  over  the  public  revenue,  under  circumstances  so  very  adverse ,  are  com¬ 
pared  with  our  large  losses  either  in  collecting  or  disbursing  that  revenue ,  their 
present  safety  seems  to  be  as  great  as  is  consistent  with  the  usual  operations 
of  the  paper  system,  or  with  the  credit  which  must  always  be  entrusted  by 
government,  in  some  wTay  or  other,  to  agents,  of  some  kind  in  keeping  the 
public  money.  In  considering  their  safety,  it  should  be  constantly  recollected 
that  the  ow  ners  and  managers  of  banks,  when  properly  regulated  by  legislative 
provisions  in  their  charters,  are,  like  other  individuals,  interested  to  transact 
business  securely  ;  are  desirous  of  making  and  not  losing  money  ;  and  that 
these  circumstances,  with  the  preference,  in  case  of  failure,  belonging  to  depo¬ 
sitors  and  holders  of  their  bills  over  the  stockholders,  united  with  the  security, 
if  not  priority,  given  to  the  government,  render  them,  in  point  of  safety ,  generally, 
much  superior  to  individual  agents  of  the  United  States.” 


21 


If  there  be  any  fact ,  inconlestibly  established  in  our  history,  and  by  the  exp 
rience  of  all  other  governments,  it  is  the  superior  safety  of  banks  as  depositors 
over  any  individual  custody.  The  reason  of  it  is  obvious.  The  more  cbmplc 
organization  of  banks,  the  number  of  their  officers  acting  as  mutual  checks  < 
each  other,  the  daily  supervision  to  which  they  are  subjected,  their  forms  of  doii 
business,  all,  furnish  securities,  which  can  never  be  had  in  case  of  the  isolate 
possession  of  money  by  an  individual,  whatever  responsibilities  he  may  be  boun< 
by.  And  if  a  loss  of  the  moneys  committed  to  them  should  occur  either  by  ac¬ 
cident,  fraud,  or  violence,  the  capital  of  the  bank  stands  pledged  for  the  security 
of  the  depositor.  This  is,  after  all,  the  only  kind  of  security  that  can  be  relied  on 
with  confidence.  If  any  gentleman  will  take  the  trouble  to  read  the  notes 
and  remarks  annexed  to  the  various  cases  of  default,  presented  in  the  document 
from  the  House  of  Representatives  to  which  I  have  referred,  he  will  see  how 
utterly  worthless  and  illusory  is  the  personal  security  on  which  we  have  hereto¬ 
fore  relied.  The  instances  in  which  any  thing  has  been  obtained  from  sureties,  to 
make  good  the  default  of  their  principal,  are  like  angel’s  visits — “  few  and  far 
between.”  The  general  return  is,  “  the  securities  insolvent,”  “  conveyed  away 
their  property,”  “  not  found,”  “  residences  not  known,”  or  some  other  equally 
unavailable  return. 

In  England  and  France,  as  well  as  here,  this  species  of  security  has  been 
found  either  nominal  or  mischievous  ;  and  in  France  it  has  for  many  years,  been 
wholly  given  up.  The  only  kind  of  security,  that  is  recognized  there,  is  like  that 
which  the  banks  give  in  the  responsibility  of  their  stock.  Every  person  who 
receives  an  appointment,  connected  with  the  collection  or  disbursement  of  the 
revenue,  is  required,  before  he  enters  on  the  duties  of  his  office,  to  deposite  with 
the  government,  as  security,  an  amount  of  money,  proportioned  to  the  probable 
amount  of  the  public  treasure  that  will  pass  through  his  hands.  This  money  is 
held  by  the  government  as  a  guarantee  for  the  faithful  administration  of  the  trust 
conferred,  and  forms,  at  the  same  time,  a  part  of  its  financial  resources  on  which 
it  pays  an  interest  of  4  per  cent,  till  restored  to  the  officer  on  his  satisfactorily 
acquitting  himself  of  his  responsibilities,  or  till  it  be  otherwise  forfeited  by  his 
default.  The  moneys  thus  deposited  with  the  government,  by  public  officers, 
as  guaranties  for  the  faithful  performance  of  their  duties,  are  denominated  Cau « 
tionnemens ,  and  amount  to  a  very  large  sum.  I  happen  to  have  in  my  posses¬ 
sion,  the  report  made  by  the  French  Minister  of  Finance,  Count  Chabrol,  to  th( 
king  in  March  1830,  from  which  it  appears  that  the  Caulionnemehs  on  the  1st  dai 
of  January  of  that  year  amounted  to  the  enormous  sum  of  frs.  226,483,973 
(two  hundred  and  twenty-six  millions,  four  hundred  and  eighty-three  thousand, 
nine  hundred  and  seventy-three  francs,)  at  a  time  when  the  whole  revenue  of 
the  kingdom  did  not  exceed  frs.900,  000,000,  (nine  hundred  millions  of  francs.) 
Now,  sir,  if  gentlemen  mean  to  introduce  here  the  system  of  individual  depo¬ 
sitaries  ot  the  public  moneys,  let  them  be  warned  by  the  experience  of  the  coun¬ 
try  from  which  they  borrow  that  system  that  it  can  be  made  safe  only  by  the  pre¬ 
cautionary  device  of  C autionnemens,  the  effect  of  which  would  be  to  give  to  the 
millionaires  of  our  cities  the  monopoly  of  all  fiscal  employments. 

But,  sir,  great  as  is  the  danger  of  heavy  pecuniary  losses  to  the  government 
under  this  system,  I  regard  even  that  as  a  trifle  compared  with  the  extensive  demo¬ 
ralization  it  would  produce  in  the  country — by  the  temptation  held  out  to  pecula¬ 
tion,  to  private  cupidity,  to  political  corruption,  in  the  large  sums  of  public  money 
lying  idle  in  the  hands  of  the  public  officers. 

[  have  now,  Mr.  President,  gone  through  my  objections  to  this  Bill  on  account 
of  what  it  contains.  I  object  to  it  also,  and  not  less  earnestly,  on  account  of  what 
it  does  not  contain.  It  contains  no  provision  for  the  relief  of  the  country.  It 
“  takes  no  thought”  for  the  public.  It  looks  only  to  the  ease  and  comfort  of  the 
government.  The  most  urgent  want  of  the  country,  the  highest  interest  of  all, 


22 


is  a  speedy  restoration  of  specie  payments  by  the  banks.  Now,  too,  is  the  critical 
and  decisive  moment.  The  banks  have  been,  hitherto,  diligently  and  steadily 
curtailing  their  discounts  and  circulation,  with  a  view  to  that  resumption,  ’till  they 
have  brought  their  business  within  such  safe  limits,  that  they  might  now  easily 
resume  with  a  little  encouragement.  But  if  they  are  once  again  let  loose  from 
these  salutary  bounds, — if,  despairing  of  a  general  resumption,  and  yielding  to 
the  strong  temptations  of  irredeemable  issues,  they  should  again  expand,  all  hope 
will  be  lost  of  recalling  them  to  a  specie  standard,  and  the  disastrous  reign  of  an 
inconvertible  paper  currency  will  be  indelinitely  prolonged.  Now,  then,  is  the  mo¬ 
ment  to  join  in  this  great  work  of  effecting  a  restoration  of  specie  payments. 
But  does  this  Bill  do  anything  toward  its  accomplishment?  On  the  contrary, 
it  does  every  thing  it  can  to  retard  and  obstruct  it.  In  the  run  it  would  create 
on  the  banks  for  specie,  both  by  the  demand  it  makes  of  it  for  the  uses  of  the 
government,  and  by  the  general  discredit  which  the  high  example  of  the  govern¬ 
ment  would  stamp  on  bank  paper,  it  throws  new  and  insurmountable  obstacles  in 
the  way  of  resumption.  ’ 

But.  the  Honorable  Senator  from  New  York  says  that  the  resumption  of  specie 
payments  by  the  banks  is  no  concern  of  this  government — that  it  is  exclusively 
an  affair  of  the  states  and  of  the  banks  themselves — and  we,  who  urge  the  neces¬ 
sity  of  promoting  by  every  proper  and  practicable  means,  the  accomplishment  of 
this  great  object,  are  reproached  with  using  an  argument,  which,  he  tells  us,  be¬ 
longs  to  the  friends  of  a  National  Bank.  Now,  sir,  I  beg  leave  to  say  to  the 
honorable  Senator  that  both  reason  and  experience  prove  that  the  only  effectual 
means  of  preventing  a  National  Bank  is  to  bring  about  a  resumption  of  specie 
payments  by  the  State  Banks,  and  that  nothing  is  more  directly  calculated  to  lead 
to  the  re-establishment  of  a  Bank  of  the  U.  S.,  than  the  course  of  those  who  would 
do  nothing  toward  effecting  that  resumption.  Let  the  honorable  Senator  look 
back  to  that  most  instructive  period,  rich  in  lessons  for  the  present  times — the 
former  suspension  of  specie  payments  by  the  banks  from  1814  to  1817 — and  he 
will  see  that  it  was  the  unwillingness  or  the  inability  of  the  State  Banks  then  to 
resume  specie  payments,  which  alone  led  to  the  establishment  of  a  National  Bank. 
Let  him  read  the  official  correspondence  of  Mr.  Dallas — the  numerous  reports 
and  communications  of  that  able  and  patriotic  man,  worthy  of  him  and  of  the 
country — and  he  will  find  through  out,  an  explicit  recognition  of,  and  unvarying 
testimony  to  this  great  truth — that  if  the  State  Banks  could  have  been  induced 
more  promptly  to  resume  specie  payments  at  that  time,  there  wmuld  have  been 
no  occasion  for  a  National  Bank,  and  that  that  institution  would  not  have  ex¬ 
isted.  The  true  means  of  preventing  its  re-establishment  now  is  by  the  instru¬ 
mentality  of  the  State  Banks,  under  the  lead  and  encouragement  of  the  govern¬ 
ment,  to  restore  to  the  country  a  sound,  convertible  currency. 

This  government  can  and  ought  to  aid  in  this  great  work.  Its  vast  revenue 
power,  and  its  pervading  action,  Coextensive  with  the  whole  Union,  give  it 
means  and  influences  which  the  states  do  not  possess.  It  holds,  indeed,  through 
that  power,  a  lever  of  the  greatest  efficacy,  for  controling  the  entire  currency  of 
the  country.  Through  its  collections  and  disbursements,  it  can  hold  out  induce¬ 
ments  of  the  most  influential  character  to  sway  the  course  of  the  banks.  In  the 
mode  of  conducting  its  receipts  and  payments,  it  has  it  in  its  power  to  set  an  exam¬ 
ple  of  the  most  persuasive  influence  toward  the  restoration  of  general  confidence . — 
In  a  disturbed  state  of  the  currency  like  the  present,  these  are  powers  to  be  exer¬ 
cised  in  a  spirit  of  liberality  and  benignity — not  of  menace,  denunciation  or 
vengeance.  The  occasion  demands  the  language  of  encouragement  and  support — 
not  of  severity  and  sternness.  Look  at  the  communications  of  Mr.  Dallas  and 
Mr.  Crawford  with  the  banks  during  the  former  suspension  of  specie  payments, 
and  it  will  be  seen  in  what  spirit  the  influence  of  the  government  was  then  ex¬ 
erted,  and  effectually  exerted,  in  the  end,  to  accomplish  a  return  to  specie  pay- 


23 


ments.  The  banks  were  not  then  outlawed  by  the  official  press — they  were  not 
then  put  under  the  ban  of  the  government — they  were  not  then  pursued  as  con¬ 
spirators ,  but  were  treated  as  institutions  having  themselves  a  stake  in  the  com¬ 
mon  weal,  and  with  which  the  common  interests  of  the  whole  country  were  iden¬ 
tified.  It  will  be  edifying,  for  a  moment,  to  look  back  to  the  manner  in  which 
the  government  then  conducted  its  relations  with  the  banks  ;  and  I  must  say  that 
if  the  exertions  of  the  banks,  generally,  since  the  recent  suspension  of  specie 
payments,  to  prepare  themselves  for  a  resumption  bv  a  steady  and  persevering 
curtailment  of  their  business  and  profits,  be  compared  with  the  course  of  the  banks, 
on  the  former  occasion,  in  taking  advantage  of  the  suspension  to  enlarge  their 
issues  to  a  most  extravagant  extent,  and  in  obstinately  refusing  to  apply  the 
valuable  public  stocks  held  by  them  to  acquiring  the  ability  to  resume,  the 
banks  now  are  entitled,  at  least,  to  as  much  liberality  and  favor  as  were  shown 
to  them  then. 

By  the  joint  resolution  of  April,  1816,  which  has  been  so  often  referred  to,  it  was 
made  the  duty  of  the  Secretary  of  the  Treasury  to  take  such  measures  as  he  should 
deem  necessary  to  effect  a  collection  of  the  revenue  in  gold  and  silver,  Treasury 
notes  or  the  notes  of  specie  paying  banks.  In  the  discharge  of  this  duty,  Mr. 
Dallas  very  soon  opened  a  correspondence  with  the  State  Banks  to  induce  them 
to  return  to  specie  payments.  In  a  circular  which  he  addressed  to  them  on  the 
22d  of  July  1816,  he  used  this  language  : 

“From  the  State  Banks,  a  sincere  and  effectual  exertion,  in  the  common  cause  of  restoring  the 
legal  currency,  is  certainly  expected  and  required  ;  hut  in  return  they  will  merit  and  receive  the 
confidence  of  the  Treasury  and  of  the  National  Bank:  the  transfer  of  the  public  funds  from  the 
State  Banks  to  the  National  Bank  and  its  branches  will  be  gradual ,  and  the  notes  of  the  State 
Banks  will  be  freely  circulated  by  the  Treasury  and  the  National  Bank." 

In  a  preceding  part  of  the  same  letter,  he  says — 

“  The  present  opportunity  is  embraced  to  repeat  the  assurances  which  have  been  uniformly  given 
and  maintained ,  that  this  Department  feels  the  fiscal  interests  of  the  government ,  and  the  success¬ 
ful  operations  of  the  Bank  of  the  U.  States,  to  be  intimately  connected  with  the  credit  and  pros¬ 
perity  of  the  State  Banks." 

Here,  we  see  the  language  of  the  government  toward  the  banks  was  that  of 
encouragement  and  confidence.  They  were  assured,  in  advance,  of  the  friend¬ 
ship,  and  even  of  the  support  of  the  government,  if  they  would  faithfully  co-operate 
in  the  common  cause  of  restoring  the  legal  currency. 

The  communications  of  Mr.  Crawford,  the  able  and  distinguished  successor  of 
Mr.  Dallas,  were  in  the  same  spirit.  You,  Mr.  President,  and  those  who  acted 
with  you  in  those  difficult  times,  will  recollect  that,  although  the  joint  resolution  of 
April,  1816,  indicated  the  20th  of  Feb.  following,  as  the  day  for  a  general  resump¬ 
tion  of  specie  payments,  the  banks  determined,  in  a  convention  held  by  them  for 
the  purpose  of  deliberating  on  the  subject,  not  to  resume  till  the  1st  of  July,  1817. 
In  order  to  induce  them  to  change  that  determination,  Mr.  Crawford  made  a 
formal  proposition  to  them  that  if  they  would  resume  on  the  20th  of  February,  the 
public  money  then  in  their  vaults  should  not  be  transferred,  at  all,  to  the  Bank 
of  the  United  States,  (constituted  by  its  charter  the  general  depository  of  the  na¬ 
tional  funds)  and  that  between  that  day  and  the  1st  of  July,  no  portion  of  the  pub¬ 
lic  money  should  be  drawn  from  them  for  any  purpose  whatever,  unless  the  neces¬ 
sities  of  the  public  service  imperiously  required  it.  I  beg  leave  to  read  to  the 
Senate  the  following  extracts  from  his  circular  to  the  banks  of  20th  Dec.  1816, 
submitting  that  proposition : 

“  The  means  of  the  Treasury  to  aid  the  operations  of  the  banks  in  effecting  a  revolution  in 
the  state  of  the  currency,  so  imperiously  necessary  to  the  public  interest,  are  considered  am¬ 
ple,  and  the  strongest  disposition  exists  to  apply  them ,  so  as  to  produce  the  most  beneficial  re¬ 
sults.” 


24 

“In  making  the  above  proposition  to  the  State  Banks,  the  strongest  reliance  is  placed  in 
their  disposition  to  join  in  the  effort  necessary  to  relieve  the  community  from  the  evils  to 
which  it  has  been  subjected,  by  the  disordered  state  of  the  circulating  medium.  It  is  confi¬ 
dently  believed  that  the  interests  of  the  banks  and  of  the  community  are  not  in  opposition  to 
each  other,  and  that  any  sacrifice,  which  the  effort  may  cost  them,  will  be  compensated  by  the 
advantages  and  facilities  which  it  is  in  the  power  of  the  Treasury  to  afford  them." 

“  The  deep  interest  which  the  Treasury  has  in  the  support  of  bank  credit ,  and  the  connection 
it  has  with  the  Bank  of  the  United  States,  would,  independent  of  the  known  disposition  of 
that  institution  to  conciliate  the  State  Banks,  be  sufficient  to  protect  them  against  an  illiberal 
policy  on  its  part.” 

In  this  communication,  it  will  be  perceived,  that  Mr.  Crawford  felt  and  avowed 
that  the  means  of  the  Treasury,  to  aid  in  the  restoration  of  specie  payments  were 
ample.  He  freely  proffered  that  aid  to  the  State  Banks — he  not  only  made  them 
the  most  liberal  propositions  for  their  own  advantage,  but  he  gave  them  a  specific 
pledge  of  protection  and  support  against  any  illiberal  policy  on  the  part  of  the  Bank 
of  the  United  States.  An  appeal  thus  urged  to  both  the  interests  and  patriotism 
of  the  State  Banks,  could  not  fail  to  be  effectual.  It  accomplished  its  object. 
The  banks  changed  their  original  determination,  and  did  resume  specie  payments 
on  the  20th  of  Feb.,  1S17. 

Now,  Sir,  can  any  one  doubt  that  if  the  same  spirit  had  actuated  the  Treasury 
Department  in  its  relations  with  the  banks  recently :  if,  especially,  when  a  majo¬ 
rity  of  the  banks,  represented  in  the  Bank  Convention,  assembled  in  New  York, 
in  November  last,  manifested  a  strong  desire  to  fix  an  early  day  for  the  resump¬ 
tion  of  specie  payments,  and  were  prevented  from  doing  so  only  by  the  influence 
of  a  powerful  and  overshadowing  institution — if,  I  say,  Sir,  the  Treasury  Depart¬ 
ment  had  shown,  on  that  occasion,  the  same  dispositions  which  animated  Mr. 
Crawford  in  1816,  and  had  come  forward  and  given  assurances  of  support  to 
that  portion  of  the  banks,  who  were  anxious  to  return  to  specie  payments, 
against  the  “illiberal  policy”  of  the  Bank  of  the  United  States,  can  there  be 
a  doubt  that  at  this  moment,  we  should  be  in  sight  ot  a  fixed  period  for  the  ter¬ 
mination  of  the  present  calamitous  and  disordered  state  of  the  currency.  But, 
unfortunately,  the  policy  has  been  to  stand  entirely  aloof  from  the  banks,  after 
having  contributed,  it  is  admitted  on  all  hands,  by  the  measures  of  the  Govern¬ 
ment,  in  some  one  or  other  of  its  branches,  to  the  embarrassments  by  which  they 
were  overthrown.  No  aid,  no  encouragement  has  been  given — not  even  a  voice 
of  cheering  has  been  uttered  amid  the  general  distress.  On  the  contrary,  odi¬ 
um  and  prejudice  have  been  extensively  invoked  through  the  press,  at  least,  to 
render  more  complete  that  want  of  confidence,  which  is  the  sole  obstacle  to  the 
re-establishment  of  both  the  credit  and  ability  of  the  banks.  And  now,  in  the 
sequel,  comes  this  fatal  Sub-Treasury  bill  to  deal  them  the  last  blow  in  their 
prostrate  condition.  The  great  interests  of  the  country,  connected  with  the  resto¬ 
ration  of  the  credit  of  the  banks,  and  of  the  currency  which  they  supply,  have  been 
overlooked  or  unappreciated ;  and  the  whole  object  seems  to  have  been  to  de¬ 
vise  some  plan  by  which  the  Government  could,  in  future,  get  along  in  the 
smoothest  way — by  which  it  could  be  relieved  from  those  responsibilities,  and  pro¬ 
tected  from  that  “  shower  of  imputations”  in  the  discharge  of  its  duties  which, 
the  honorable  Senator  from  New  York,  (Mr.  Wright,)  so  pathetically  deprecates. 

What,  then,  I  would  ask,  are  governments  instituted  for,  if  it  is  not  to  meet 
difficulties,  in  the  public  cause — to  meet  and  overcome  them — to  encounter  re¬ 
sponsibilities — to  endure  a  shower  of  imputations,  yea  “  the  pelting  of  the  pitiless 
storm”,  if  duty  to  the  country  demand.  And  an  able  man  and  a  patriot  need  not 
repine  at  these  trials  of  his  virtue  and  talents.  The  ultimate  gratitude  of  his 
country  will  ever  be  in  proportion  to  the  temporary  injustice  he  may  sustain  by 
the  bitterness  of  enemies  or  the  persecutions  of  faction.  How  enviable,  at  this 
moment,  the  fame  of  Mr.  Crawford,  than  whom  no  man,  in  his  day,  encountered 
more  responsibilities  by  the  bold  and  fearless  manner  in  which  he  met  the  duties 


25 


of  his  station,  or  sustained  more  unfounded  imputations.  But  truth  has  triumphed 
over  prejudice  and  error,  and  he  now  lives  and  will  forever  live  in  the  grateful  me¬ 
mory  of  his  country.  This  desire  to  avoid  difficulties  and  their  attendant  responsi¬ 
bilities,  founded,  as  I  think  I  have  shown  it  to  be,  in  mistake  as  to  the  true  inter¬ 
ests  of  public  men,  is  the  source  of  still  greater  calamities  to  the  country.  It 
is  the  natural  parent,  strange  as  it  may  seem  at  first  sight,  of  all  schemes  of 
strong  government ;  and  is  not  unsuitably  avowed  by  the  honorable  Senator  from 
New  York,  as  a  consideration  in  favor  of  a  measure,  the  effect  of  which,  in  my 
humble  judgment,  would  be  to  render  this  Republican  government  of  ours  one  of 
the  strongest  on  the  face  of  the  earth.  On  this  subject,  sir,  I  beg  leave  to  read 
to  the  Senate  the  remarks  of  the  profoundest  observer,  perhaps,  of  human  affairs 
that  ever  lived.  They  are  full  of  instruction,  and  cannot  be  too  well  weighed  by 
public  men.  In  speaking  of  the  National  Assembly  of  France,  Burke  makes 
use  of  these  words  : 

“  Their  purpose  every  where  seems  to  have  been  to  evade  and  slip  aside  from  difficulty. 
This  it  has  been  the  glory  of  the  great  masters,  in  all  the  arts,  to  confront  and  overcome; 
and  when  they  had  overcome  the  first  difficulty,  to  turn  it  into  an  instrument  for  new  con¬ 
quests  over  new  difficulties.”  “  This  amicable  conflict  with  difficulty  obliges  us  to  an 
intimate  acquaintance  with  our  object,  and  compels  us  to  consider  it  in  all  its  relations.  It 
will  not  suffer  us  to  be  superficial.  It  is  the  want  of  nerves  for  such  a  task  ;  it  is  the  fondness 
for  short  cuts  and  falacious  facilities,  that  has,  in  so  many  parts  of  the  world,  created  govern¬ 
ments  with  arbitrary  powers .”  “It  is  this  unwillingness  to  wrestle  with  difficulty  which 
has  obliged  the  National  Assembly  of  France  to  commence  their  schemes  of  reform  with 
abolition  and  total  destruction .” 

The  disposition  to  evade  difficulty ,  the  policy  of  short  cuts ,  we  are  told  by  this 
great  master  of  political  wisdom,  has  in  every  part  of  the  world,  “  created  govern¬ 
ments  with  arbitrary  powers  and  was  what  in  France  led  the  National  Assem¬ 
bly  “  to  commence  their  schemes  of  reform  with  abolition  and,  total  destruction .” 
Now,  sir,  if  this  had  been  specially  written  for  our  warning,  and  with  express 
reference  to  the  question  before  us,  it  could  not  have  been  more  apposite  or 
more  instructive.  Every  summary  invention,  in  a  free  country,  suggested  by  the 
ease  of  government ,  however  intended,  will  be  found,  at  last,  to  carry  with  it  the 
deepest  dangers  to  the  liberties  and  happiness  of  the  people.  The  honorable 
Senator  from  New  York,  too,  should  remember  that  it  was  to  him  who  should 
untie,  and  not  to  him  who  should  cut  the  Gordian  knot,  that  the  ancient  oracle 
promised  the  glories  of  empire.  The  first  is  the  achievment  of  skill  and  industry, 
and  its  fruits  are  peace,  liberty  and  happiness.  The  second  is  the  achievment  of 
power,  and  its  result  is  the  establishment  of  power.  Let  the  honorable  Senator 
from  New  York  untie  the  knot,  by  leading  the  banks  to  a  resumption  of  specie 
payments,  (as,  I  am  sure,  by  proper  means,  he  could  easily  do,)  and  not  cut  it 
by  the  Sub-treasury  scheme,  and  I  will  be  among  the  first  to  award  him  the  civic 
wreath.  With  Mr.  Jefferson,  in  his  memorable  letter  to  Mr.  Madison,  while 
the  Federal  Constitution  was  under  consideration,  I  say,  “  I  am  no  friend  to  strong 
government.  It  is  always  oppressive.  It  puts  the  Governors  at  their  ease ,  but  at 
the  expense  of  the  people .”  Here  lies  the  fatal  objection  to  the  Sub-treasury 
scheme.  It  puts  the  “Governors  at  their  ease,’’ but  is  dangerous  and  “oppres¬ 
sive,”  to  the  people. 

What  system  of  policy,  then,  it  will  be  asked,  would  I  pursue  ?  The  same  great 
authority,  whose  words  I  have  already  quoted,  says,  “  a  good  patriot  and  a  true 
politician  will  always  consider  how  to  make  the  most  of  the  existing  materials  of 
his  country.”  This  is  the  foundation  principle  on  which  I  would  build.  Expe¬ 
rience  has  shown,  in  the  language  used  by  the  present  Secretary  of  the  Treasury 
in  1834,  that  banks  are  the  most  “  responsible,  safe,  convenient  and  economi¬ 
cal”  fiscal  agents  for  the  government.  The  State  Banks  are  institutions  now 
existing.  I  would  “  make  the  most ”  of  them  for  the  public  service.  There  is  no 
national  banking  institution  in  existence  ;  and  the  condition  of  the  country,  already 


26 


surcharged  with  banks,  the  state  of  public  opinion,  the  known  sentiments  and 
pledges  of  those  charged  with  the  public  administration,  all  conspire  to  render  it 
very  unlikely  that  there  will  be  any  such  institution  at  least  for  years  to  come.  1 
say  farther — in  my  humble  opinion,  there  ought  to  be  no  such  institution  ;  first, 
because  there  is  no  constitutional  authority  to  create  it,  and  secondly,  because  its 
political  dangers,  in  any  form  in  which  it  has  heretofore  existed,  have  been  found 
to  more  than  counterbalance  its  supposed  advantages,  in  other  respects.  Then, 
as  to  the  Sub-treasury  scheme,  it  is  a  novelty  utterly  unknown  to  our  laws  and 
usages,  which  could  not  be  brought  into  existence  without  violating  all  the  ha¬ 
bitudes  of  our  people,  deranging  the  operations  of  business,  and  hazarding  the 
most  cherished  principles  of  our  political  institutions.  What,  then,  ought  to  be 
done  ?  Recur  to  the  “  existing  materials  of  the  country,”  the  State  Banks, — 
“  make  the  most”  of  them  for  the  convenience  of  the  government,  as  well  as  for 
the  general  good — reform  their  abuses,  correct  their  defects  and  adopt  every  pre¬ 
caution  which  may  be  necessary  to  ensure  their  fidelity  and  efficiency. 

These  institutions,  it  is  true,  have  recently,  in  common  with  every  other  interest 
in  the  country  and  with  the  whole  commercial  world,  been  subjected  to  serious 
embarrassments.  All  agree,  however,  though  differing  as  to  the  particular  causes 
which  produced  them,  that  those  embarrassments  have  been  the  result  of  very 
peculiar  and  extraordinary  circumstances.  The  banks,  too,  which  were  employed 
as  the  depositories  and  fiscal  agents  of  the  government,  have,  for  the  most  part, 
amid  circumstances  of  the  greatest  difficulty,  actually  discharged  all  their  engage¬ 
ments  to  the  government,  enormously  heavy,  as  they  were,  in  consequence  of  the 
large  surplus  revenue  ;  or  the  few  who  have  not  yet  done  so,  have  satisfactorily 
secured  the  comparatively  small  balances  due  from  them,  to  be  paid  at  short  pe¬ 
riods,  according  to  an  indulgence  voluntarily  granted  to  them  by  Congress.  The 
past,  therefore,  candidly  considered,  furnishes  no  ground  against  the  renewed 
employment  of  the  State  Banks  as  fiscal  agents  of  the  government.  Expe¬ 
rience  may  have,  and  doubtless,  has,  disclosed  defects  and  errors  in  the  particular 
plan  upon  which  they  have  been  heretofore  employed.  Correct,  then,  those  errors — 
supply  those  defects — but  do  not  reject  their  employment  altogether.  This,  sir, 
is  the  general  principle  on  which  I  have  bottomed  the  proposition  I  have  submitted 
as  a  substitute  for  the  bill  reported  by  the  honorable  Senator  from  ]New  York  ; 
and  I  will  now  proceed  to  explain,  in  detail,  those  provisions  of  the  substitute 
which  distinguish  it  from  the  state  bank  deposite  system  as  heretofore  organized. 

It  is  now  generally  acknowledged  that  one  of  the  principal  circumstances  which 
contributed  to  embarrass  the  operations  of  the  late  Deposite  system,  was  the  large 
number’of  banks  employed  as  depositories, — amounting,  in  the  end,  I  believe,  to 
near  ninety.  This  increase  of  number,  in  part,  was  rendered  necessary  by  that 
provision  in  the  act  of  June,  1836,  which  required  that,  where  the  amount  of 
public  deposites  in  any  bank  exceeds  threefourths  of  its  capital  actually  paid  in, 
the  surplus  should  be  transferred  to  some  other  bank.  In  the  execution  of  the  act, 
however,  (from  considerations  which  I  am  not  able  to  explain)  there  was  a  still  far¬ 
ther  increase  in  the  number  of  depositories,  not  called  for  by  the  requirements  of 
this  provision.  It  is  obvious  how  the  whole  play  of  the  machinery  must  have 
been  weakened  and  obstructed  by  this  needless  complexity  of  its  parts.  I  am 
satisfied  that  twenty  banks,  judiciously  selected  and  properly  located,  would  be 
competent  to  do  the  whole  business  of  the  Treasury  Department,  with  much 
less  danger  of  embarrassment  to  the  Banks,  and  a  far  more  easy  and  effectual 
supervision  on  the  part  of  the  Secretary.  The  substitute,  therefore,  provides  that 
the  number  of  Banks  to  be  employed  as  public  depositories  shall,  in  no  case,  ex¬ 
ceed  twenty-jive,  to  be  chosen  from  among  the  most  solid  and  respectable  banks 
in  the  respective  States,  and  their  location,  as  well  as  number,  to  be  determined 
solely  with  reference  to  the  wants  and  convenience  of  the  Treasury  in  conducting 
its  fiscal  operations. 


27 


The  substitute  also  proposes  an  important  change  in  the  mode  of  selecting 
the  deposite  banks.  Heretofore  thev  were  chosen  by  the  Secretary  of  the  Trea¬ 
sury,  at  his  will  and  pleasure  alone.  This  sole  agency  of  the  Executive  will,  in 
designating  the  depositories  of  the  public  money,  exposed  the  late  system  to  a  sus¬ 
picion  of  favoritism  and  a  want  of  confidence  in  general,  which  greatly  impaired 
its  moral  force,  and  admitted  a  possibility  of  abuses,  which,  it  is  certainly  pro¬ 
per,  should  be  guarded  against.  It  was  this  which  caused  it  to  be  characterised  as 
th c  pel-bank  system.  I  propose  to  divest  it  of  this  character  by  subjecting  the  se¬ 
lection  of  the  Secretary  of  the  Treasury,  in  every  case,  to  the  supervision  and 
control  of  Congress.  If  the  selection  be  made  during  the  session  of  Congress,  it 
is  to  be  immediately  submitted  for  the  approval  of  the  two  Houses — if,  during  the 
recess,  it  is  to  be  laid  before  them  at  the  commencement  of  the  next  session,  to 
be  in  like  manner  confirmed  or  annulled  by  them.  The  effect  of  this  provision 
will  be  to  bring  every  tiling’,  relating  to  the  public  moneys,  under  the  direct  and 
efficient  control  of  the  representatives  of  the  people  and  the  States,  and  in  so 
delicate  and  important  a  matter,  to  leave  as  little  as  possible  to  Executive  dis¬ 
cretion. 

Another  leading  provision  in  the  substitute  is  one  which  requires  the  deposite 
banks  to  have  weekly  settlements  with  the  banks,  in  their  vicinity,  with  which 
they  have  business  transactions,  and  to  call  for  balances  in  specie,  whenever  and 
to  whatever  extent  it  may  be  necessary  to  check  over-issues  and  to  preserve  the 
soundness  of  the  currency.  In  the  adoption  of  this  practice  by  the  late  Bank  of 
the  United  States,  consisted  its  boasted  power  and  influence  as  a  regulator  of  the 
currency.  There  is  no  reason  why  the  same  salutary  control  should  not  be 
exercised  by  the  deposite  banks,  and  with  even  greater  effect,  inasmuch  as  their 
aggregate  capital  and  presumed  amount  of  transactions  with  other  banks,  would, 
no  doubt,  exceed  those  of  the  late  National  Bank.  It  will  be  perceived  from  the 
terms  of  this  provision  in  the  substitute,  that  it  is  not  contemplated  to  enjoin  on  the 
deposite  banks  a  fixed  and  inexorable  requisition  of  balances  from  the  other  banks 
in  specie,  under  all  circumstances  whatever ;  for  considering  the  large  balances 
that  would  be  habitually  accumulated  by  them  against  the  other  banks  in  the  pro¬ 
cess  of  collecting  the  public  revenue,  such  a  requisition  would  be  destructive  in 
many  cases,  to  institutions  of  unquestionable  soundness.  It  is  contemplated, 
therefore,  that  this  power  should  be  exercised  under  proper  safe-guards,  and  only 
to  the  extent  that,  may  be  necessary  to  restrain  imprudences  or  excesses,  endan¬ 
gering  the  general  currency.  It  was  to  this  extent  only,  as  I  have  shown  in  a 
previous  part  of  these  remarks,  that  the  power  was  exercised  by  the  late  Bank 
of  the  United  States. 

The  substitute  likewise  makes  it  the  duty  of  the  Secretary  of  the  Treasury  to 
use  his  influence  to  bring  about,  an  arrangement,  (as  no  doubt  is  entertained  he 
could  do,)  among  the  several  deposite  banks  to  receive  and  credit  as  cash  the 
notes  of  each  other  in  payment  of  the  public  revenue,  wherever  so  tendered.  The 
effect  of  this  arrangement  would  be  to  put  the  notes  of  the  deposite  banks  prac¬ 
tically  on  the  same  footing  as  the  branch  notes  of  the  late  Bank  of  the  United 
States — every  where  receivable  in  payment  of  public  dues,  and  enjoying,  conse¬ 
quently,  a  general  credit  and  circulation  throughont  the  Union.  It  would  give 
to  the  country,  to  a  great  extent,  the  advantages  of  an  uniform  paper  currency, 
as  the  preceding  provision  would  secure  to  it  a  sound  one  ;  and  the  two  together, 
in  supplying,  practically ,  the  benefits  promised  by  a  National  Bank,  would  super¬ 
sede  the  strongest  arguments  now  urged  in  favor  of  such  an  institution. 

In  regard  to  the  kinds  of  money,  in  which  the  public  revenue  is  to  be  collected, 
the  substitute  adopts,  with  slight  modifications,  the  provision  of  the  currency  bill 
of  the  last  session  of  Congress.  It  declares  that  the  public  dues,  of  every  descrip¬ 
tion,  for  lands  as  well  as  customs,  shall  be  received  in  gold  and  silver,  or  Trea¬ 
sury  notes,  or  such  notes  of  specie-paying  banks,  (under  certain  restrictions 
intended  to  promote  the  suppression  of  small  notes,)  as  the  deposite  banks,  sub- 


28 


ject  to  the  supervision  and  control  of  the  Secretary  of  the  Treasury,  shall  agree  to 
credit  to  the  United  States  as  cash.  It  will  be  perceived  that  in  the  proposition 
now  submitted,  !  have  postponed  for  one  year  the  exclusion  of  the  notes  of  banks 
which  issue  bills  or  notes  under  five  dollars.  It  is  known  that  many  of  the  States 
authorize  notes  under  that  denomination  ;  and  some,  who  have  heretofore  prohi¬ 
bited  them,  will,  it  is  supposed,  authorize  the  issuing  of  them  under  existing  cir¬ 
cumstances,  and  for  a  limited  period.  It  is  evident  that  the  use  of  this  descrip¬ 
tion  of  notes,  in  supplying  the  place  of,  and  consequently  diminishing  the  demand 
for  specie  in  small  dealings,  would  tend  materially  to  facilitate  the  resumption  of 
specie  payments  by  the  banks.  This  consideration  has  induced  me,  under  the 
peculiar  circumstances  of  the  times,  to  adjourn  for  one  year  the  period  for  exclud¬ 
ing  the  notes  of  banks  issing  bills  or  notes  under  five  dollars  ;  and  the  same  con¬ 
sideration  has  prevailed  with  me,  for  the  present,  to  limit  the  farther  exclusion  of 
bank  notes  to  the  issues  of  such  banks  as  shall,  after  the  expiration  of  two  years, 
continue  to  issue  bills  or  notes  under  ten  dollars.  In  doing  this,  under  the  exi¬ 
gencies  of  the  times,  I  wish  to  be  understood  as  not  abandoning  my  original  opin¬ 
ions,  (which  remain  unchanged,)  in  favor  of  extending  the  prohibition  of  small 
notes  ultimately  to  all  under  the  denomination  of  twenty  dollars. 

Finally,  the  substitute,  in  furtherance  of  the  great  policy  of  fixing  a  period  to  the 
present  disastrous  reign  of  irredeemable  paper,  provides  that  after  the  1st  day  of 
July  next,  the  notes  of  no  bank  which  shall  not  then  have  bona  fide  resumed 
specie  payments,  shall,  at  any  time  thereafter,  be  received  in  payment  of  the  public 
dues.  This,  in  connection  with  the  liberal  provisions  made  by  the  Substitute,  in 
other  respects,  for  re-establishing  the  credit  of  convertible  bank  paper,  will,  I  am 
persuaded,  bring  about  a  general  resumption  of  specie  payments  at  the  time  desig¬ 
nated.  The  mere  fixation  of  a  day  by  Congress  will  exercise  a  powerful  moral 
influence  ;  and  not  the  less  so,  as  the  day  fixed  corresponds  with  that  indicated  by 
a  majority  of  the  banks  in  the  Bank  Convention  held  in  New  York  in  November 
last. 

These,  Mr.  President,  are  the  leading  provisions  of  the  measure  I  have  submit¬ 
ted,  which  distinguish  it  from  the  system  heretofore  adopted  for  the  employment  of 
State  Banks  as  depositories  of  the  public  money.  In  many  respects,  they  make 
of  it  a  new  system,  obviating  some  of  the  strongest  objections  which  have  been 
hitherto  urged  against  it,  providing  new  guards  against  abuses  and  containing  new 
provisions  forextending  its  usefulness  and  efficiency.  Under  an  able  and  not  un¬ 
friendly  direction,  I  feel  every  confidence  that  it  would  meet  both  the  wants  of  the 
government  and  the  wishes  of  the  country. 

I  shall,  doubtless,  be  asked  what  arrangement  I  propose  in  regard  to  the 
banks  discounting  on  the  public  deposites-  There  is  no  absolute  interdiction  of 
their  doing  so,  in  the  measure  I  propose,  (for  to  this,  I  think,  I  shall  be  able  to 
show  there  are  insuperable  obstacles,)  but  it  carefully  withdraws  the  stimulus  to 
the  use  of  that  power  which  has  heretofore  been  applied,  and  it  moreover  furnishes 
a.  positive  security ,  of  an  important  character,  against  the  excessive  use  of  it.  It 
will  be  recollected  by  the  Senate  that  the  law  of  June,  1836,  which  organized  the 
late  deposite  system,  (besides  requiring  of  the  banks  very  important  and  onerous 
services,)  required  them  to  pay  an  interest  of  two  per  cent,  on  all  the  public  de¬ 
posites  in  their  possession  exceeding  one-fourth  of  their  capital  actually  paid  in. — 
Now,  this  not  merely  authorized,  but  compelled  the  banks  to  discount  on  the 
public  moneys,  whether  they  willed  it  or  not,  in  order  to  enable  them  to  pay  the 
interest  charged.  It  was  a  stimidus  administered  by  the  government  to  the  use  of 
the  power.  This  stimulus,  this  compulsion  rather,  I  propose  to  withdraw  by  re¬ 
pealing  that  clause  of  the  law  of  1836  which  charged  the  banks  interest  on  the 
public  moneys  ;  for  the  important  services  to  be  rendered  by  them  as  fiscal  agents 
of  the  government,  are  the  fair  and  proper  equivalent  of  any  legitimate  advantage 
to  be  incidentally  derived  by  them  from  the  custody  of  the  public  moneys. 

In  the  limitation  of  the  number  of  deposite  banks  to  twenty-five,  as  proposed  by 


/ 


29 


the  measure  I  have  had  the  honor  to  submit,  there  is  an  important  security  against 
the  public  deposites  being  made  the  basis  of  bank  discounts,  to  any  great  extent. 
It  must  not  be  forgotten  that  the  charters  of  all  the  State  Banks  fix  a  general 
limit  beyond  which  they  are  not  permitted  to  extend  their  discounts.  That  limit 
is,  I  believe,  ordinarily  twice,  or  twice  and  a  half,  the  amount  of  theip  capitals 
paid  in.  As  the  public  deposites,  under  the  measure  I  propose,  would  be  confined 
to  twenty-five  banks,  it  is  evident  that  they  could  not  be  used,  to  any  great 
extent,  (relatively  to  their  amount, )by  those  banks  to  enlarge  their  discounts,  be¬ 
fore  they  would  encounter  an  impassable  barrier  in  the  limit  of  their  charters,  'i  his, 
it  is  well  known,  occurred  in  several  cases,  (particularly  in  New  York,)  under 
the  operation  of  the  late  system,  notwithstanding  the  greater  number  of 
banks  then  employed  as  depositories ;  and  in  those  cases,  authority  was 
given  to  the  banks  which  had  thus  exhausted  their  chartered  power  of 
discounting  on  the  public  deposites,  to  turn  over  the  surplus,  on  which  they 
could  no  longer  discount  under  the  limitations  of  their  charters,  to  other  banks, 
that  they  might  discount  upon  them.  To  any  arrangement  of  this  sort  tor  multiply¬ 
ing  bank  discounts  on  the  public  deposites,  the  measure  I  have  submitted  would 
oppose  an  insuperable  obstacle,  as  it  inflexibly  fixes,  under  all  circumstances 
whatever,  the  number  of  banks  to  be  employed  as  depositories  of  the  public  mo¬ 
neys  ;  and  in  filing  that  number  at  twenty-five,  the  salutary  charter  limitation 
upon  the  power  of  discounting,  would,  as  I  have  just  shown,  soon  be  brought 
into  action  to  prevent  excess  by  them. 

I  think,  therefore,  Mr.  President,  that  under  the  provisions  of  the  Substitute  I 
have  proposed  for  the  consideration  of  the  Senate,  there  would  be  no  danger 
of  any  unreasonable  extension  of  discounts  on  the  publ-ic  deposites.  I  know,  how¬ 
ever,  there  are  gentlemen  of  great  intelligence  and  patriotism,  who  are  for  an  abso¬ 
lute  prohibition  of  the  banks  discounting,  to  any  extent,  however  moderate,  on  the 
public  deposites,  and  who  favor,  as  the  means  of  carrying  out  that  prohibition,  a 
system  of  special  deposites.  The  high  respect  I  entertain  for  the  opinions  of 
those  gentlemen  has  induced  me  to  consider  their  suggestion,  with  more  than 
ordinary  anxiety  to  come  to  the  same  conclusions  ;  but  after  thorough  examin¬ 
ation  and  reflection,  according  to  the  best  lights  of  my  understanding,  1  am  satis¬ 
fied  that  no  system  of  special  deposites,  however  specious  in  theory,  could  be 
worked  out  in  practice,  without  involving  consequences  which  they  themselves, 
(or  at  least,  a  large  majority  of  them,)  would  promptly  repudiate.  In  the  first 
place,  it  is  demonstrable,  I  humbly  conceive,  that  any  system  of  special  depo¬ 
sites,  to  be  practical  and  efficient,  must  lead  to  a  collection  of  the  revenue, 
directly  or  indirectly ,  in  specie  ;  and  this  they  oppose  as  earnestly  as  I  do.  The 
Government  must  always  hold  itself  ready  to  pay  its  creditors  in  the  lawful  curren¬ 
cy  of  the  country,  if  demanded .  This  the  banks  are  bound  to  do,  on  behalf  of 
the  Government,  under  the  general  deposite  system.  But  if  you  adopt  the  special 
deposite  system  and  collect  the  revenue,  at  the  same  time,  in  bank  notes,  the 
banks  would  be  bound  to  pay  out  to  the  public  creditor  only  the  identical  notes 
deposited  with  them  ;  for  this  is  the  fundamental  and  immutable  idea  of  a  special 
deposite.  How,  then,  would  such  a  system  work  ?  The  public  creditor  would 
present  his  warrant  to  a  deposite  bank — the  bank  would  offer  him,  in  payment, 
first  this  note  and  then  that,  which  had  been  specialty  deposited  with  it :  but  none 
of  these  notes  suiting  the  convenience  of  the  creditor,  and  the  bank  being  bound 
to  pay  no  other,  the  public  claimant  would  go  unpaid,  and  the  engagements  of 
the  Government  be  dishonored.  To  avoid  the  danger  of  such  a  result,  the  Go¬ 
vernment,  if  it  adopted  a  system  of  special  deposites,  would  be  driven,  of  neces- 
’  sity,  to  a  collection  of  the  revenue  in  gold  and  silver  ;  or,  otherwise  receiving  the 
notes  of  specie-paying  banks  pro  forma,  collect  the  specie  for  them  from  the 
banks  by  which  they  were  issued,  and  place  that  specie  on  special  deposite.  But 
where  would  be  the  difference,  in  the  practical  effects  on  the  banks  and  the  business 
and  interests  of  the  community  connected  with  them,  between  collecting  the  reve¬ 
nue,  in  the  first  instance,  in  gold  and  silver,  and  collecting  it  in  the  notes  of  specie- 


30 


paying  banks,  to  be  converted  into  goid  and  silver  by  demand  upon  the  banks'? 
The  honorable  Senator  from  ew  York  (Mr.  Wright)  expressed  the  opinion,  that 
the  latter  mode  of  operation  would  be  the  harshest ;  and  when  it  is  considered  that 
this  periodical  conversion  of  bank  notes  would  be  in  large  masses ,  and  attended, 
consequently,  with  periodical  and  distressing  contractions  of  the  currency ,  I  cannot 
but  agree  with  him.  At  all  events,  there  are  but  these  two  modes  of  working 
out  a  special  deposite  system  in  practice,  and  neither  the  one  nor  the  other,  it.  seems 
to  me,  can  be  made  acceptable  to  those  who  oppose  the  Sub-treasury  scheme, 
on  account  of  its  tendency  to  create  two  currencies  in  the  country — gold  and 
silver  for  the  Government — paper  for  the  people. 

There  are  subsidiary  objections  to  this  special  deposite  system,  which,  al¬ 
though  not  of  so  much  weight  as  that  which  I  have  just  stated,  cannot  be  over¬ 
looked  in  a  just  and  comprehensive  estimate  of  it.  If  you  adopt  it,  you  re¬ 
nounce,  at  once,  all  means  of  engaging  the  interests  and  enlisting  the  co-operation 
of  the  banks  to  carry  out  any  of  those  reforms  in  the  paper  currency,  which  have 
heretofore  been  so  favorite  an  object  of  the  policy  of  the  country.  You  must  also 
pay  them,  and  pay  them,  too,  no  inconsiderable  sum  for  their  services  to  tho 
Government,  and  thus  abandon  one  of  the  strong  grounds  (that  of  economy,}  on 
which  bank  agency  has  heretofore  been  preferred  to  individual  agency,  in  con¬ 
ducting  the  ope  rations  of  the  Treasury. 

But,  to  take  up  the  subject  in  a  more  enlarged  view,  is  there  any  valid  rea¬ 
son  why  banks  should  not  be  permitted  to  discount,  to  a  moderate  extent,  on  ave¬ 
rage  balances  of  public  money  in  their  possession,  as  well  as  on  individual  depo¬ 
sites?  Wherever  banks  exist,  to  receive  deposites,  public  or  private,  is  a  regular 
branch  of  their  business  ;  and  to  discount  upon  the  average  balances  oj  those  dc- 
posites,  which  experience  shows  are  not  likely  to  be  drawn  out  by  the  depositors, 
is  as  legitimate  and  acknowledged  an  operation  of  banking  as  to  discount  upon  their 
capitals.  Is  it  not  for  the  interest  of  all  that  this  should  be  done — that  no  portion 
of  the  national  capital  should  be  annihilated  by  being  locked  up  from  use,  but 
that  the  whole  should  be  made  tributary,  in  some  way  or  other,  to  the  invigo- 
ration  and  support  of  the  national  industry?  No  just  distinction  can  be  shown, 
in  this  respect,  between  public  and  private  deposites.  Accordingly,  in  all  coun¬ 
tries  where  banks  exist,  and  where  the  public  moneys  are  deposited  in  those  in¬ 
stitutions,  deposites  of  that  kind  have  been  invariably  recognised,  within  proper 
limits,  as  a  perfectly  legitimate  source  of  discounts  and  accommodation  to  the  com¬ 
munity.  It  is  admitted  that  it  has  been  uniformly  the  case  in  this  country,  in  re¬ 
gard  to  the  public  funds  both  of  the  general  government  and  of  the  States,  from 
the  adoption  of  the  Constitution  down  to  the  present  day.  What  new  light,  then, 
has  broken  in  upon  us,  that  we  are,  all  at  once,  grown  so  much  wiser  than  our 
fathers  ?  In  England,  the  practice  is,  and  has  been  invariably  the  same  ;  and  here 
I  take  upon  me  to  confront  a  statement  which  I  have  repeatedly  seen  made 
to  the  contrary — to  wit,  that  the  balances  of  the  public  moneys  in  the  hands  of  the 
Bank  of  England  were  not  discounted  upon,  but  were  regularlv  and  habitually  ap¬ 
plied  to  the  purchase  of  Exchequer  Bills,  on  behalf  of  the  government.  The  fact 
is  otherwise — the  Bank  of  England  has  the  use  of  these  balances,  for  banking 
purposes  ;  and  this  use  of  them  is  so  well  understood  and  avowed  that  in  some  in¬ 
stances,  where  the  balances  have  risen  to  a  very  great  amount,  (as,  for  a  series  of 
years  after  1S06,  they  did  to  between  £11,000,000  and  £12,000,000,  equal  to 
near.  $60,000,000  of  our  money,)  the  bank  has  been  required  to  pay  a  special  com¬ 
pensation  to  the  government  for  that  use.  But  the  ordinary  balances  of  public  mo¬ 
ney  in  the  Bank  of  England  range  from  £4,000,000  to  £5,000,000  pounds  ster¬ 
ling — about  twenty  millions  of  dollars  of  our  money — the  use  of  which  is  permit¬ 
ted  to  the  bank  without  any  compensation.  In  like  manner,  the  balances  of  pub¬ 
lic  money  in  France,  which  are  occasionally  transferred  to  the  Bank  of  France, 
are  permitted  to  be  used  as  a  source  of  extended  discounts,  and  I  am  informed  by 


31 


an  enlightened  correspondent  in  that  country,  were  actually  so  used  to  the  great 
relief  of  industry  and  trade,  during  the  late  commercial  crisis. 

Shall  a  less  beneficent  use  be  made  of  the  public  moneys,  not  called  for  by  the 
necessities  of  the  Government,  in  this  Republic  of  ours,  than  in  the  monarchies  of 
Europe?  Shall  we  alone,  of  all  the  great  family  of  modern  civilized  communi¬ 
ties,  revert  to  the  barbarous  practice  of  hoarding  (and  that,  too,  in  specie,)  the  oc¬ 
casional  surpluses,  which,  from  the  nature  of  our  revenue  system,  can  neither 
be  foreseen  nor  guarded  against  ?  A  most  able  and  eloquent  friend  in  the  other 
House,  (Mr.  Legare)  has  justly  characterised  the  process  of  taxation  as  a  species 
of  confiscation.  It  is  so,  sir.  Is  it  not  incumbent  upon  us,  then,  when  by  so 
harsh  a  process,  we  have  undesignedly  levied  upon  the  people  more  than  is  ne¬ 
cessary  for  the  wants  of  the  Government,  to  mitigate  the  exaction  as  much  as 
possible  by  restoring  the  overplus  to  their  use  through  the  channels  of  business 
and  commerce.  Why  should  the  Government  play  the  dog  in  the  manger ,  neither 
using  its  idle  hoards  itself,  nor  permitting  any  body  else  to  use  them.  Efforts 
have  been  made  to  render  the  practice  of  discounting  upon  the  publicdeposit.es 
odious,  by  representing  it  as  a  thing  for  the  benefit  of  the  banks  alone.  But 
is  it  so  ?  Does  not  every  class  of  the  community  experience  the  benefit,  and  none 
more  so  than  the  great  agricultural  class,  the  price  of  whose  products  depends 
mainly  on  the  facilities  of  sound  credit,  and  the  abundance  of  active  capital  dif¬ 
fused  among  the  merchants — the  more  immediate  customers  of  the  banks  ? 

It  has  been  sometimes  said,  also,  that  the  practice  of  discounting  on  the  public 
deposites  adds  to  the  fluctuations  of  the  currency.  But  the  reverse  is  demonstra¬ 
bly  true.  When  a  large  amount  of  revenue  is  collected  by  the  Government, 
and  is  neither  disbursed  in  the  public  service,  nor  returned  to  the  community 
through  the  medium  of  discounts,  a  sudden  and  distressing  contraction  of  the  cm - 
rency  necessarily  ensues.  If,  however,  that  portion  of  the  public  money,  not  re¬ 
quired  for  the  public  service,  is  permitted  to  be  used  in  the  way  of  discounts  for 
short  periods,  by  the  banks,  the  circulation,  through  the  double  process  of  Go¬ 
vernment  disbursements  and  bank  issues,  is  maintained  at  an  uniform  level,  with¬ 
out  sensible  contraction  or  expansion.  The  banks  being  enabled  to  foresee  at 
what  periods  the  funds  issued  by  them  will  be  required  for  occasions  of  public 
expenditure,  call  them  in  as  they  are  wanted  for  disbursement — what  is  draw  n  in 
by  the  hand  of  the  banks,  is  immediately  let  out  by  the  hand  of  the  Government — 
and  thus  the  current  of  circulation  is  kept  steady  and  full. 

These  truths  have,  until  lately,  been  universally  felt  and  acknowledged  ;  and 
by  none  more  emphatically,  or  with  greater  weight  of  authority  than  the  distin¬ 
guished  individual  “in  whose  footsteps”  the  present  administration  was  expected 
to  tread.  It  is,  doubtless,  recollected  by  the  Senate,  that,  on  the  occasion  of  the 
removal  of  the  deposites  from  the  Bank  of  the  United  Slates,  President  Jackson, 
in  the  able  and  memorable  paper  which  he  presented  to  his  cabinet,  stated  that 
the  funds  thus  removed  were  not  to  be  “  annihilated ” — that  they  “  would  be 
again  issued  for  the  benefit  of  trade ”  by  the  institutions  to  which  they  were  trans¬ 
ferred.  This  was,  then,  considered  a  trait  of  liberal,  beneficent,  and  states¬ 
manlike  policy,  on  w'hich  the  Chief  Magistrate  and  his  act  were  triumphantly  sus¬ 
tained  and  vindicated  by  his  friends  before  the  people.  The  same  distinguished  in¬ 
dividual,  in  his  very  last  message  to  Congress,  declared  “  it  was  contrary  to  the 
genius  of  our  free  institutions  to  lock  up  iu  vaults  the  treasure  of  the  nation.” 
Now  the  highest  ambition  of  statesmanship  seems  to  be  to  contrive  these  self¬ 
same  “  vaults ,”  in  which  the  funds  of  the  nation  are  to  be  sent  to  their  “  long  re¬ 
pose,”  as  “  dead  men’s  bones;”  for  once  there,  all  that  remain,  beyond  the 
wants  of  the  Government,  are  to  be  buried,  annihilated,  destroyed,  to  every 
purpose  of  useful  existence.  What  has  produced  these  sudden  and  singular  re¬ 
volutions  of  policy  and  doctrine  ?  Is  it  because  an  extraordinary  and  accidental 
state  of  things,  the  result  of  peculiar  and  anomalous  causes,  has  involved  the 
banks,  individuals,  and  the  Government,  in  temporary  embarrassment  ?  Then 


32 


I  say  nothing  is  more  unsafe  than  for  statesmen  to  found  general  and  permanent 
rules  of  policy  on  isolated  and  exceptional  cases.  We  must  look  to  the  habitual 
and  ordinary  course  of  human  affairs,  collect  from  them  the  average  results  of 
experience  and  observation,  and  guide  our  action  by  those  results.  Because  the 
Commonwealth’s  Bank  of  Massachusetts  has  failed,  because  it  suits  the  purpose 
even  of  grave  Senators  to  use  it  daily  as  a  stalking-horse  on  this  floor,  are  we  to 
be  “frighted  from  our  propriety,”  and,  therefore,  distrust  and  denounce  the  whole 
banking  system  of  the  country  ?  Are  we  to  take  advantage  of  temporary  and 
factitious  excitements,  to  get  up  and  foster  a  popular  prejudice  against  banks  as 
a  fund  for  political  speculation,  at  the  expense  of  all  the  sober  realities  of  life” 
and  the  practical,  pervading,  home-bred,  interests  of  the  country. 

As  I  said,  on  a  former  occasion,  Mr.  President,  I  stand  here  as  no  advocate  of 
the  banks.  I  have  not  the  slightest  interest  in,  nor  conection  with,  them,  direct  or 
indirect,  present  or  prospective.  I  am  as  sensible  as  any  man  of  the  dangers  and 
abuses  to  which  they  are  liable,  and  I  will  go,  hand  in  hand,  with  any  man  in 
devising  securities  against  the  one,  and  applying  correctives  to  the  other.  But  as 
a  practical  legislator  and  a  patriot,  1  am  bound  to  look  to  the  actual  interests  of  so¬ 
ciety  ;  and  in  that  view,  I  cannot  fail  to  see  that  any  violent  shock  given  to 
the  established  system  of  business  and  credit  in  the  country  must  produce  a  wide¬ 
spread  scene  of  confusion  and  distress,  involving,  in  its  destructive  visitation, 
every  class  of  the  community. 

In  offering  the  measure  I  have  submitted  to  the  Senate,  I  have  discharged  what 
I  consider  to  be  my  duty  to  the  country.  That  country  is  now  in  a  state  of  suffer¬ 
ing  and  distress,  aggravated  by  deep  anxieties  and  apprehensions  in  regard  to  the 
future.  The  measure  1  propose  would,  I  firmly  believe,  give  relief  for  the  present 
and  hope  for  the  future.  It  could  not  fail  to  restore  confidence,  and  in  doing  that, 
to  revive  the  languishing  energies  of  trade,  to  quicken  the  labors  and  the  hopes 
of  the  husbandman,  the  manufacturer  and  the  mechanic,  to  raise  enterprise  again 
upon  its  feet,  and  above  all,  to  put  an  end  to  that  unnatural  and  suicidal  war, 
which,  for  the  last  eighteen  months,  has  grown  up  between  the  government 
of  the  country,  and  its  business  and  industry.  In  presenting  such  a  measure, 

I  cannot  but  regret  that  I  shall  be  deprived  of  the  support  of  many  members  of 
this  body  with  whom  1  have  lately  stood,  side  by  side,  in  upholding  and  defending 
the  principles  on  which  it  rests  My  consolation,  however,  is  that  I  stand  now 
where  I  stood  then.  On  the  other  hand,  the  measure  they  bring  forward  and 
patronise  is  one  which,  three  years  ago,  we  all  united  in  opposing,  and  which  was 
then  denounced,  in  the  name  of  the  administration  and  its  friends,  as  a  “  dangerous 
enlargement  of  Executive  power,  and  putting  into  its  hands  the  means  of  corrup¬ 
tion.”  This  measure  cannot  have  changed  its  character  by  mere  efflux  of  time; 
and  thinking  of  it  now  as  I  thought  of  it  then,  I  still  oppose  it. 

In  taking  this  course,  I  know  full  well,  Mr.  President,  I  am  to  incur  the 
anathemas  of  party.  But  I  can  never  forget  that  I  have  a  country  to  serve,  as 
well  as  a  party  to  obey.  “  ’Tis  Rome  demands  our  help  ;”  and  for  one  she  shall 
have  mine,  according  to  the  humble  measure  of  my  abilities  and  the  best  lights  of 
my  understanding.  The  zealots  of  both  parties  may  denounce  and  condemn 
as  they  have  heretofore  denounced  and  condemned  me ;  but  sustained  by  thdg 
consciousness  of  upright  intentions  and  a  faithful  devotion  to  the  interests  of  mV 
country,  I  shall  hold  my  course  unfaltering  ;  and  even  with  the  terror  before  niy 
eyes  of  sinking  into  that  small  minority  of  which  the  honorable  Senator  from  New 
York,  (Mr.  Wright,)  so  charitably  warned  us,  I  shall  yet,  animated  by  a  sense  of 
duty,  find  in  my  soul  one  drop  of  patience.” 


■ 


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